Peloton’s new CEO Peter Stern recently indicated he is not looking to have Peloton be acquired.
Yesterday, Stern spoke at the Bloomberg Tech Summit, covering a wide variety of topics. Towards the end of the interview, he was specifically asked whether he saw Peloton being acquired, or continuing to operate as an independent company.
Stern replied that Peloton would be a “standalone company for years to come.”
Over the years, there have been rumors about Peloton being acquired by other companies – with there being specific reports about Nike considering acquiring Peloton, as well as Amazon acquiring Peloton. More recently, there were rumors of multiple private equity firms considering a buyout of Peloton.
In the interview yesterday, Stern went on to provide some clarity around the direction he was taking the company, as it related to Peloton being acquired. He said:
“I was not hired to sell this company. I was hired to bring this company back to growth, reinvigorate it, and that is happening.”
Stern also indicated his commitment to Peloton’s hardware business, saying that “We are an equipment company.” He said that the “magic formula” of Peloton consisted of 3 things: Equipment, Software, and Human Coaching – all wrapped in an encouraging community.
According to Stern, it is this combination of 3 things that distinguishes Peloton from other app-based fitness companies – that don’t have the hardware piece. So while Peloton has made progress in their return to profitability by focusing on the money from subscribers (both from app-only subscribers, as well as All-Access subscribers who own the app), Stern does not see Peloton trying to spin-off the hardware business, or focusing solely on the app. He wrapped up this discussion by stating:
“Our future is not to try to scale the app at the expense of that equipment business.”
Both of Peloton’s prior CEO’s (Barry McCarthy & John Foley) had publicly stated how they had a goal of Peloton getting to 100 million subscribers – of which app growth was an important piece. Stern has yet to share if he is aiming for the same 100 million member mark.
This interview comes days after Peloton launched “Repowered” – their own marketplace for buying & selling used Peloton equipment.
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