Exercise startup Peloton, known for streaming spin classes for its indoor bikes, has registered to go public, joining a crowded field of tech companies that have or will join the public markets this year.
Like many of its tech peers, Peloton appears confident in its plans for a public offering, despite not yet being profitable. In its registration documents, the company reported that it had made $915 million in revenues in the past fiscal year, a significant jump from the $435 million it produced the year before, but ultimately saw net losses of about $196 million, about quadruple its previous net losses of $48 million.
Founded in 2012, Peloton produces high-end, internet-connected stationary bikes and treadmills that work in concert with its streamed exercise classes. Bike packages approximately start at $2,200 (including delivery) while the treadmills begin about $4,300. Required content subscriptions are $39 a month. The company also offers a $19.49 option that lets users stream classes on mobile devices or a computer.
Since 2016, Peloton has seen its subscriber base grow from 107,000 people to more than half a million.
"Peloton's a really interesting case. This has been a year — obviously — of a lot of high-profile IPOs already," Joshua Franklin, a corporate finance correspondent at Reuters, told Cheddar on Wednesday. "Peloton kind of gets a little bit of the good stuff that people have liked about IPOs so far this year, and also a little bit of the stuff that people aren't so wild about."
He pointed to the Peloton's subscription model, revenue growth, and focus on disruption in the fitness space as potential positives for investors. On the other hand, Franklin cautioned that: "They don't specify in their IPO filing how they're going to reach profitability. And we've seen with Uber and Lyft, that's something that investors really are quite focused on these days."
In going public, the startup hopes to appeal to investors with a multifaceted business model. It has framed itself as a fusion of a media, fitness, and tech company, producing interconnected hardware, platform, and content. In the prospectus made public today, it says: "We are a technology company that meshes the physical and digital worlds to create a completely new, immersive, and connected fitness experience.
Peloton also says it's an "apparel" and "social connection" company because it sells branded clothing and incorporates a messaging feature into its streaming platform.
Unlike popular spin class brands SoulCycle and Flywheel, Peloton does not rely on physical locations. It runs a small number of studios where the startup films the content it streams online, but in its filing the company said revenue from classes at these locations "has been immaterial to date."
The startup appears to have inspired — or at least, catalyzed — an emergence of similar businesses. Mirror, founded in 2016, sells vertical, in-home screens that stream live exercise classes. 2017 saw the introduction of Hydrow, a startup that sells modernized rowing machines that stream rowing classes.
Meanwhile, Equinox Group has announced its plans to sell an at-home bike that will feature SoulCycle spin classes. Flywheel has also started selling their own home bikes with coordinated, live-streamed content, a move that has earned it a lawsuit over a patent dispute with Peloton itself.
Rich Rosenblum, Co-Founder and President of crypto trading firm GSR, joins Cheddar News' Closing Bell, where he explains why investors are rushing to Ethereum and breaks down the advantages it holds over other digital assets.
Earnings season continues in the week of November 15-19, with results on tap from Walmart, Home Depot, Lowe's, Target, and more. New economic data on Tuesday will provide a deeper look at the retail space when the Commerce Department releases October retail sales numbers, following this week's hot inflation data. Plus, President Biden is set to visit GM's electric vehicle factory in Michigan, where he is expected to formally introduce the plant's grand opening.
On this episode of 'Your Future Home', Chip Wade, Emmy Award-winning HGTV Host, breaks down all the ways you can avoid breaking the bank on energy costs this holiday season, especially when it comes to outfitting your home with smart tech; Dr. Wendy Osefo, Entrepreneur, Professor & Cast Member of Bravo's 'Real Housewives of Potomac', discusses her popular new Onyi Home Essentials line and how ideas of family and legacy helped shape it; Cheddar breaks down everything you need to know about how to determine your non-negotiables when purchasing a house.
One NFL team says it is using data to help it win off the field. The Seattle Seahawks say they want to be a source of inspiration for other organizations that want to reap the rewards of a data-driven culture and aim to show the unlikely role data can play in professional sports operations. Seattle Seahawks Director of Business Strategy and Analytics Paimon Jaberi joins Cheddar News' Closing Bell to discuss.
Aurora Cannabis CEO Miguel Martin joins Cheddar News' Closing Bell to discuss the company's latest earnings results, how it will achieve positive EBITDA by 2023, and the state of the cannabis industry amid potential U.S. federal legalization.
Disney saw misses on both its top and bottom lines for its fourth quarter. The entertainment giant also fell just short of Wall Street expectations for new Disney+ subscribers. CFRA Research media and entertainment analyst Tuna Amobi joined Cheddar News' Closing Bell to break down what this means for the future of Disney.
Johnson & Johnson is the latest company to announce this week it is splitting into two companies, separating its consumer operations from its pharmaceutical and medical devices unit. Electronics firm Toshiba also made a similar announcement today, and General Electric earlier this week also said it would be spinning off its aviation, healthcare, and power businesses. What does this mean for investors - and will this become a trend among conglomerates? Barron's Senior Writer Al Root joins Cheddar News' Closing Bell to discuss why Johnson & Johnson is splitting up, what this strategy means for conglomerates, and why they might pursue a break-up.
Business is booming for the used car marketplace Shift while the automotive industry as a whole struggles with demand and supply chain issues stemming from the global semiconductor shortage. Co-CEO and co-founder George Arison joined Cheddar's "Closing Bell" to talk about the company's stellar Q3 earnings and how it was able to meet demand.
Disney+ miss on new subscribers in Q3 and the growing momentum for moviegoers returning to brick-and-mortar theaters has brought the streaming business into question. Seth Schachner, managing director at Strat Americas, joined Cheddar to discuss the state of streaming and the growing number of options consumers have. "Streaming is for sure here to stay and I think more robust than ever," he said. "The real thing that's happening, not just to Hollywood but to lots of verticals from music to sports, is just that there's tons and tons of consumer choice."
