Breakingviews - Peloton fails one of finance’s oldest workouts

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(Reuters Breakingviews) - The fitness industry strives to find new ways to do a ...

A Peloton exercise bike is seen after the ringing of the opening bell for the company's IPO at the Nasdaq Market site in New York City, New York, U.S., September 26, 2019. REUTERS/Shannon Stapleton

Peloton’s worth hinges on rapid growth and rising gross profit margins. The company hopes its $2,000 bikes and pricier treadmills could reach one in 10 U.S. households – lots of room for growth from the current one in 200 or so, based on numbers in the company’s initial public offering prospectus. Peloton loses money, but touts positive trends in “connected fitness churn” and “subscription contribution margin.

On most of those filters, Peloton looks anything but fit. Rivalry is intense, from connected device-makers like Fitbit and GoPro to other at-home fitness equipment makers. New entrants are coming thick and fast, from Zwift to Mirror. The company’s suppliers arguably have too much power: it gets 91% of its equipment from just four of them. Buyers are dispersed, but can cancel their subscriptions at any time.

 

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No extra money in American's budgets--sorry corporations we told you. well-paid-workers = monied consumers = LONG-TERM biz profit = thriving economy. No more going into debt to fatten the rich man's wallet.

Great line..

ClueHeywood

Did people wise up and realize riding your bike outside is free?

Not surprised. This is just an overpriced spin bike with a built in tablet!😂😂😂😂

Ummmm....it’s not that great of a product. 🙄

BREAKING: a company that makes shouldn't capitalism cheap financiers inner circle bullshit juicero abomination

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Peloton fails one of finance’s oldest workoutsThe exercise-bike maker’s IPO valued it at $8 bln but its stock promptly sagged. The lack of profit is not the big problem. It’s the competition from other connected-workout startups and health fads plus dependence on a few key suppliers. That makes Peloton look anything but fit. johnsfoley It’s a stationary bike company ReutersBiz johnsfoley But I recall the pros of Peleton that profgalloway mentioned in a not so long ago Pivot pod with karaswisher. His 6 minutes ago hottake prognosis has changed dramatically. What happened?
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