Sudden cramp

26 September 2019 By John Foley Follow @johnsfoley

The exercise-bike maker’s IPO valued it at $8 bln but its stock promptly sagged. The lack of profit is not the big problem. It’s the competition from other connected-workout startups and health fads plus dependence on a few key suppliers. That makes Peloton look anything but fit.

This content is for Subscribers only

Context News

Shares in Peloton Interactive fell on their first day of trading in New York on Sept. 26.

The company, which makes technology-enabled exercise bikes and treadmills, priced its initial public offering a day earlier at $29 per share, the top of its indicated range, giving it a market capitalization of $8.1 billion. By 3 p.m. in New York, the stock was down 13% at $25.11.

Peloton has two classes of shares. Class B shares, which have 20 votes each, are held mostly by executives, directors and large pre-IPO investors. The offering consists of Class A shares, which have just one vote each.

The company made $915 million in revenue for the financial year ended June 30, more than twice its sales the year before. Its operating loss of $202 million was roughly quadruple that of a year earlier.

Email a friend

Please complete the form below.

Required fields *