Peloton to Relaunch Brand and Introduce New App Following 22% Revenue Drop in Q3 2023

Peloton, the connected fitness equipment and service provider, plans to relaunch its brand and introduce a new version of the Peloton app with a tiered membership structure, following a 22% decline in revenue for Q3 2023. Despite this decrease, the company’s CEO, Barry McCarthy, highlighted the positive performance of the company in Q3, which included growth in connected fitness subscriptions by 5%, a 47% increase in gross profit, and a reduction in adjusted EBITDA loss year over year by $175 million.

Peloton’s rebrand aims to expand its marketing beyond bikes, to include all of its product offerings, as 57% of its customers’ workouts did not involve the bike in Q3 2023. The company’s pre-owned bike program, which launched in December, and its rent-to-buy program, which started in March 2022, have been successful in resonating with customers, making up 24% of hardware sales for the quarter. These initiatives have contributed to an increase in connected fitness subscribers to 3.1 million, a 5% increase from the same period last year.

Despite the positive results, Peloton anticipates a seasonal decline in subscriber growth in Q4 2023, as warmer summer months may push people outside. For the quarter, the company expects revenue to range between $630 million and $650 million, a 6% decrease compared to the same period last year.