雅虎香港財經 Peloton stock tanks on forecast for 'challenging' fourth quarter
Peloton (PTON) stock sank on Thursday after the company reported a wider-than-expected quarterly loss and said it expects a quarterly decline in subscribers for its fiscal fourth quarter amid fears of a consumer slowdown.
“Q4 will be among our most challenging from a growth perspective,” Peloton CEO Barry McCarthy wrote in a letter to shareholders on Thursday.
Peloton’s quarterly revenue of $749 million came in above Wall Street’s estimates for $708 million. But the company lost $0.79 per share when the Street had only guided for a loss of $0.46.
In the fourth quarter, Peloton expects a quarterly decline in revenue and for connected fitness subscriptions to fall into a range of 3.08-3.09 million, lower than the 3.11 million reported in the third quarter. That would mark Peloton’s first-ever quarterly connected fitness subscriber decline.
Peloton shares tanked on the news, sliding nearly 13.48% on Thursday. Shares are now off more than 95% from their pandemic peak.
“We've seen consumers respond very favorably to promotional activity in the current environment, maybe even more so than historically,” McCarthy said on the company's call. “There's certainly no exuberance in the marketplace, but it's not frozen either. So it's kind of a mixed bag and we're definitely uncertain about what's next in terms of the economic environment.”
Peloton has posted an adjusted earnings per share loss in nine straight quarters. Revenue has now decreased compared to the same period in the prior year for five straight quarters.
Amid the negative trend lines, Peloton has tried to shift its story to investors. The company has pegged its growth turnaround story to subscriptions, noting hardware sales will likely decline in the current quarter.
Peloton has attempted to change its image with consumers, too. Once a high-end fitness brand built around selling four-figure stationary bikes, Peloton cut prices last August to make its product “more accessible.” The bikes can now be found in various Hilton locations nationwide and on Amazon too.
The latest rendition came on Thursday as Peloton said it will be “relaunching” its brand and app in the next quarter in a further effort to reignite growth.
“We do expect that to widen our [total addressable market] over time,” Peloton CFO Liz Coddington said on the earnings call. "And we're also reintroducing the app. And we don't know the impact that these launches are going to have on our connected fitness [subscriber] growth in Q4. We're cautiously optimistic about that, but we have not baked any of that optimism into our guidance forecast for the quarter.”
But when the growth catalyst pointed out by management isn’t expected to grow next quarter, Wall Street isn’t often forgiving. BMO retail analyst Simeon Siegel, who has an $8 price target and Sell rating on the stock, said in a research note that he was concerned about the company's “quality of sales,” pointing out that promotions helped drive its revenue beat.
The projected quarterly subscription decline is “continuing to raise the question as to whether PTON has eclipsed its core-and-committed potential user base,” Siegel wrote.
Josh is a reporter for Yahoo Finance.
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