Peloton releases Q1 2023 FY earnings, stock price fall

This morning, Peloton released their Q1 2023 (FY) earnings.

Stock price has dropped in pre-market trading as the results didn’t meet investor’s previous expectations and estimates, and there are still signs of headwinds in the future. As noted in the report:

Given macro economic uncertainties we believe near-term demand for Connected Fitness hardware is likely to remain challenged. Our
forecast incorporates a seasonal mix-shift toward our Connected Fitness segment, expected holiday promotional activity, a mix-shift of sales toward our rental program, as well as the impact from expanding our third-party retail partnerships.

Revenue for the quarter were $617 million – which previously had been forecasted to be around $650 million.

However, free cash flow improved for the quarter – as the loss was only $246 million, compared to a $412 loss the prior quarter.

Total Connected Fitness subscriptions were up to 2.97 million – an increase of 3,000 members. The overall member count declined from 6.9 million to 6.7 million, which was due to “reflecting the roll-off of a COVID-impacted quarter from our trailing 12-month calculation (which includes an engagement component) and the decline of Peloton App subscribers in the quarter.”

Member churn lowered from 1.4% to 1.1%

Q1 2023 Earnings Data for Peloton.
Q1 2023 Earnings Data for Peloton.

CEO Barry McCarthy remains optimistic, and noted the progress the company has made since he joined – noting he originally said it would take at least a year

For the last nine months my goal has been to turn around Peloton and position it for sustained growth and scale. I thought it would take a year. We are beating that timeline.

You can see the full quarterly results here.

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Chris Lewis
Chris Lewis is the creator & founder of Pelo Buddy. He purchased his Peloton in 2018, and uses all the different devices: Peloton Bike, Tread, Row, and Guide. He has been involved in the fitness industry for more than a decade - previously co-founding the websites Mud Run Guide & Ninja Guide. You can find him on the leaderboard at #PeloBuddy.

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