In Peloton’s most recent earnings call, analysts raised concerns about the potential impact of tariffs on imports from China, Canada, and Mexico.
Addressing the issue, Peloton’s new CEO Peter Stern reassured stakeholders that the company is actively monitoring the evolving tariff landscape. In the earnings call, he stated:
“As I’m sure you all know, the questions around tariffs really represent a rapidly moving target, and so we’re closely monitoring it, I’m sure, alongside all of you. The good news here is that no Peloton branded hardware products are subject to the tariffs from China or if they were to reemerge from Mexico or Canada. And of course, most of our revenues come from subscriptions. Liz can provide a little more color here.”
Following the CEO’s remarks, Peloton’s Chief Financial Officer (CFO) Liz Coddington added further details, illuminating the limited financial exposure Peloton faces under the current proposed tariffs. She explained:
“So while the tariffs on imports from Mexico and Canada are currently paused, if all of the tariffs went into effect at the current proposed tariff rate, we would expect to see roughly 1% impact to our Connected Fitness products and that’s mainly related to Peloton apparel and Precor. And that estimate also assumes no mitigation. For China only, our unmitigated impact is well under 1% of Connected Fitness COGS.”
These comments suggest that while Peloton is keeping a close watch on tariff developments, the direct impact on its core business – particularly its hardware and subscription services – appears to be minimal.
In case you missed it, we recently shared more news from Peloton’s latest earnings call on February 6, including Stern’s comments on a potential subscription price increase.
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