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Peloton Virtual Investor & Analyst Session Recap

Yesterday, Peloton hosted a remote “Investor and Analyst Session”. The event was first announced just before the FY2020 earnings call.

The event started with Peloton CEO John Foley making some opening remarks. Next, Peloton COO Tom Cortese talked about the newly released Bike+ and Tread. Then Peloton President William Lynch covered some topics around member engagement. This was followed by Peloton CFO Jill Woodworth covering a few financial metrics. The event wrapped with a Q&A from the investor community.

You can view the presentation materials here that the Peloton leadership team covered during the presentation.

For the most part, the topics they talked about were covered in the previous earnings call or the recent Peloton product announcements. No major news or items were revealed. There were, however, a few interesting tidbits that were reiterated or worth mentioning again. The following list captures some of that information, in no particular order:

  • The possibility of new strength, yoga, and meditation instructors in the near term (next few months?) was teased
  • Peloton has plans to launch 2 new verticals of workout content over the next few months (that wouldn’t require new hardware devices)
  • Expect more featured artist series – Peloton says they will have the biggest lineup ever this fall
  • Peloton has a goal in the next few months to produce between 1200-1500 new classes a month
  • Peloton again teased their certified pre-owned program, and said it would take a few quarters for them to build up their inventory, but once they had the inventory, they would launch the program
  • Peloton has/will double their investment into product R&D
  • Look for Tread content coming to the London studio once the new production studio opens in Spring of 2021, as one of their 3 studios will be set up for Tread content
  • Peloton has plans to start producing German language Tread classes in the future to compliment their German language bike classes
  • Since 2014, the number of home bike owners with household income of 0-$100k has grown from 31% of the market to 46%
  • Since 2014, the number of home bike owners aged 25-34 has grown from 15% to 29%
  • Peloton continues to invest heavily in their production facilities, as well as their quality labs
  • Peloton’s new Tonic facility is still on track to open in December of 2020, and will have the ability to produce 1.5 million devices a year. They also have the ability to shift production between bike and tread as needed.
  • Nearly 250 million high fives were sent in fiscal year 2020
  • In 2017, 90%+ of all workouts done were cycling workouts. In 2020, this number dropped to 64% for owners of Peloton bike or tread, and 36% for Peloton Digital members – meaning Peloton is successful at getting members to do other workout categories besides just the bike.
  • More than 14 million miles have been logged by Peloton members on the Tread+
  • Peloton’s NPS score, among North American bike owners in July 2020, was 94. One of their goals, along with having 100 million subscribers, is to have a 100 NPS score.
  • Peloton is likely to see their NPS score decrease for September, due to issues around wait times to talk to customer support timed around the new product launch, as well as some unhappiness around the price drop from recent buyers.
  • Peloton plans to continue to try to get as many deliveries as possible done in-house as possible, which means they are doubling the size of their van fleet through 2021, and hope to have it tripled by 2023.
  • Since the pandemic, 80% of Peloton buyers have previously had a gym membership
  • The number of Peloton members who also have a gym membership has been decreasing. 60% a few years ago, 50% 2 years ago, 40% last year
  • Peloton Digital is not a money maker for Peloton. “It isn’t really a business” It’s a much more competitive space, and turnover and churn is much higher – and this was before Apple entered the market! Peloton looks at this more as a side benefit for members with the bike & tread, or as lead generation for sales of hardware devices – vs a profit center.

Coincidentally, the event ended up overlapping with Apple’s September iPad & Apple Watch announcement event, which also took place on September 15th @ 1:00pm ET. During the event, Apple’s new Apple Fitness+ service was announced. Peloton CEO John Foley was asked about it on the call, and his response was that Apple’s entry into the market was a legitimization of the idea of digital fitness content. He tried to downplay the threat some, mentioning that Apple was only producing digital content at this time, and not entering the fitness hardware space.

Chris L
Chris is the founder of Pelo Buddy. He purchased his Peloton in 2018, and has been riding and running ever since. You can find him on the leaderboard at #PeloBuddy.

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