Peloton Revises Outlook, Surpasses Estimates
Peloton's shares surged up to 12 percent following the announcement of a stronger-than-expected forecast for the holiday quarter. The company is focusing on repositioning itself as a comprehensive wellness brand and returning to profitability after its first hardware redesign in several years.
Financial Forecast and Performance
Peloton projected revenue between $665 million and $685 million for the three months ending in December, exceeding Wall Street's estimate of approximately $661 million for its fiscal second quarter.
“Our continued momentum on bottom line performance sets the stage for improvements on the top line as we progress through the fiscal year, fueled by our commitment to innovation and growing the Peloton community,” said CEO Peter Stern.
He expressed confidence in Peloton's ability to implement its “strategic plan, return Peloton to profitable growth, and extend Peloton’s lead in connected fitness and wellness.”
Product Recall Impact
Earlier, Peloton recalled about 877,800 units of its premium Bike+ model in the US and Canada after reports that some seat posts broke, causing riders to fall. This recall resulted in a $13.5 million expense during the first quarter.
Stock Market Update
Shares of Peloton closed at $6.71 in New York, down 22.9 percent year-to-date through Thursday's close despite the recent surge.
Summary
Peloton's promising holiday quarter outlook and strategic shift towards holistic wellness aim to drive future growth, balancing past product challenges with renewed market confidence.
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