Shares of
Peloton Interactive
were falling sharply on the heels of disappointing financial forecasts.
Shares of the at-home fitness company were down 23% to $4.26 on Thursday, while the
S&P 500
was up 0.3%. If the stock ends Thursday below $4.30 it would mark a record closing low, according to Dow Jones Market Data. Peloton shares traded as low as $4.17 on Thursday, an all-time intraday low.
For the fiscal third quarter, Peloton said it expects to post revenue of $700 million to $725 million. That’s below the consensus estimate for $749 million, and a drop from last year’s $749 million.
“Our outlook is tempered by uncertainty surrounding our ability to efficiently grow Paid App subscribers and the performance of other new initiatives, as well as an uncertain macroeconomic outlook,” Peloton said in its shareholder letter.
CEO Barry McCarthy said Peloton would fall short of its goal for cash flow.
“My primary goal for FY24 has been to restore the company to positive free cash flow for the full year,” McCarthy wrote in the shareholder letter. “Based on our updated forecast, we now expect the business to generate positive free cash flow in Q4 (vs. $(74) million in 4Q23) but to fall short of achieving our goal for the full year.”
Peloton
reported a second-quarter loss of 54 cents a share, which was in line with analysts estimates, according to FactSet, and narrower than loss per share of 98 cents a year ago. Revenue for the quarter was $743.6 million, above Wall Street expectations for $733 million, but a decline from last year’s $793 million.
Peloton recently launched the sale of its hardware by third-party retailers such as
Amazon.com
and
Dick’s Sporting Goods.
The company said in a shareholder letter on Thursday that it saw “exceptionally strong sales growth through these channels this holiday season, with year-over-year unit growth of 74% in the second quarter.”
Peloton also reported 2.98 million paid connected fitness subscriptions for the quarter. Analysts surveyed by FactSet were expecting 2.99 million.
Write to Angela Palumbo at [email protected]
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