The exercise bike maker slashed the cost of its newest product by $200.
For many analysts, there is simply no coming back from the kind of year Peloton (PTON) – Get Peloton Interactive, Inc. Class A Report‘s had.
After a series of recalls, PR crises and tanking stock, the exercise bike maker ousted chief executive John Foley and slashed over 2,800 jobs.
“Morale is at an all-time low,” one Peloton employee told CNBC amid news that the company had halted hiring and cut its full-year outlook in January. “The company is spinning out so fast.”
But despite the fact that company stock is now down over 77% from a year ago, Peloton released a new strength training guide, pushed forward with the release of a new strength training product — albeit, at $295, it is 40%, or $200, below the originally planned price.
What’s This New Peloton Product?
On Tuesday, the company announced that Peloton Guide would be available in the United States, Canada, the UK and Australia. The smart camera and workout mirror allows users to follow workouts and track exercise routines independently of its signature bikes.
After connecting it to a TV, users will see themselves on a screen as they work out.
But it is being advertised as a way for fitness fans to monitor form while lifting weights or doing core exercises. Those who already own a Peloton will be able to get it at no additional cost.
The guide veers away from the company’s more cardio-based core products like its bikes and treadmills which, at a starting price of $999, are much more expensive.
Why The Price Slash?
Originally slated to sell for $495, the Peloton Guide is the first launch since Barry McCarthy took over as company CEO last month.
Peloton
By ousting Foley, Peloton had been hoping to set itself on a new path amid falling sales and a number of PR disasters.
In May, the company recalled 125,000 treadmills amid safety issues while, in December, the “Sex And The City” TV sequel show “And Just Like That” showed popular character Mr. Big dying on a Peloton bike.
All that, however, pales compared to the death of a 6-year-old child who was pulled into the Tread+ treadmill treadmill last March.
Sales were already falling after the surge in purchases that came amid the first wave of lockdowns and stay-at-home orders in the early days of the pandemic.
Despite the new product, shares were down 5.79% at the bell on Tuesday and are down 77.29% since 2021.
Is The Market For At-Home Workout Equipment Still There?
As most still associate Peloton primarily with its stationary bikes, it is unlikely that a smart workout camera will be the one thing that helps the brand make a comeback.
Similar workout mirrors like Tonal and Mirror have been on the market for years, and the demand for at-home workout equipment has started lagging as we emerge from the pandemic and many return to in-person classes.
That said, news leaked that Amazon (AMZN) – Get Amazon.com, Inc. Report was one of the buyers eyeing a potential purchase.
Many predict that demand for fitness products will continue to grow exponentially despite momentary ebbs and flows and Peloton’s demographic of wealthy buyers is attractive to investors hoping to revitalize the brand.
That will, however, likely take much more than a few new products.
“Is a revenue-compressed Peloton expense-restructuring story (this early) exciting?” BMO Capital Markets analyst Simeon Siegel wrote in an investor note last month. “We have more questions than ever.”
