Last night, Peloton held their Q1 2022 earnings call. Investors were not pleased with what they heard, and the stock dropped ~30% overnight. Peloton reported softening demand, and revised their full year forecast downward. If you’re interested in financial analysis, several major sites are reporting financial data. You can also find a transcript of the call here, or read the shareholders letter here.
However, outside of the financial data, Peloton CEO John Foley shared several interesting pieces of information worth sharing.
First and foremost, he teased new Peloton products being released in the “coming weeks and months” (during a previous earnings call he had stated new products would be released sometime this fiscal year). During his prepared remarks at the beginning of the call, John Foley made a mention of this:
And while our growth is not what we had expected just a few short months ago, we are extending our lead in home fitness cardio and becoming a leader in strength. We make the best, most immersive and interactive home fitness products available, and we have more on the way in the coming weeks and months.
Just before wrapping up the call, he again specifically pointed his statement again:
We did say this year is going to be a big year for product launches. We stand by that. We’re excited if you caught in my prepared remarks, I alluded to the coming weeks and months of some new announcements, one that I’m very excited about. And then potentially another one next year, hopefully in H2. And we’re pushing – we’ve had a lot of fantastic R&D in the hopper for years at this point, and we are super excited to bring it to our members and to expand our opportunity. And that’s all I can say right now. But we are a technology and innovation company, and we’re going to show what that means in the coming quarters.
What new products could Peloton be releasing next?
There are a number of products he could be referring to. Most likely would seem to be the Peloton Guide (previously called Peloton Focus or Peloton Tiger) – an AI camera to count reps & check your form for you. It was recently mentioned in an on-demand class, which you can see a clip of here.
Peloton is also researching a full strength product. One they have surveyed about was codenamed the Peloton Platform, which you can read about here. While the form factor isn’t set in stone yet, this would be seen as the closest competitor Peloton has to products like Tonal.
A smaller item could be the Peloton Heart Rate band – which is actively being beta tested by members of the community. Peloton has also acquired several companies that could help them build a Peloton smartwatch or Peloton wearable, but that isn’t expected to be released in the near-term if it comes to light.
Finally, there is the Peloton rower. We know work is still being done on it, as plans for the new Peloton factory show rooms for testing it. However, based on recent comments from Peloton, it seems likely this product will be released after their strength products.
Other Interesting Information
Beyond new products, several other facts were shared.
More than 1 billion Peloton classes have been taken.
Peloton does plan to bring the new lower cost Tread to Australia in the coming months. A previous report had said they might not release it there.
The Peloton team is excited about the new Tread. It currently has an 89% NPS score, but only 11% product awareness. This means they’ll be spending more on marketing coming up to raise awareness, and hopefully increase sales.
Peloton had been seeing a sales split of around 50/50 of the original Peloton Bike vs new Peloton Bike+ prior to the price being dropped on the original Peloton Bike. Since the price was dropped, they’ve been seeing about 75% of original bike sold to 25% of Bike+.
Peloton has been seeing less traffic and visitors to their retail stores than expected the last month or two – this was one of the factors that caused them to lower their guidance.
To help reduce costs, Peloton will adjusting some of their hiring plans as well as reducing some other operational costs.
Peloton sees consumers in international markets being more price sensitive than those in the US. Speaking to the price drop of the Peloton Bike, they said “We saw a positive and sustained reception to the price moves in our international markets. This was anticipated as our international consumers have proven to be more price sensitive.”
Stay tuned to the site, as we’ll be sure to share what those new Peloton products end up being in the coming weeks and months.
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