Peloton (NASDAQ: PTON) announced a sales increase of 232%, outdoing its own expectations. Amid the coronavirus, customers have embraced home workouts and relied heavily on the company’s bikes, treadmills and streamed live classes to exert daily exercise.
Following the rise in activity, the equipment and media company upped its 2021 revenue forecast to USD3.9 Billion compared to the previous outlook of USD3.5 Billion – USD3.65 Billion. According to a Refinitiv survey, analysts had been predicting a revenue of USD3.63 Billion. Peloton is confident that this quarter will be its first ever billion-dollar quarter for sales.
“We see Peloton increasingly capitalizing from a secular shift in consumer behavior amid extended social distancing, with elevated demand we’re seeing for at-home fitness (longer order to delivery for “couple more quarters”) and reflected in sustained low churn levels (0.65% vs. 0.90% year ago). With over $2 billion of liquidity, we believe Peloton has significant resources to continue investing in product and platform to drive growth,” wrote CFRA analyst Camilla Yanushevsky in a note to clients.
Despite the positive growth, the company has struggled to keep up with the heightened demand. Subsequently, buyers have expressed frustration towards delayed shipments and inadequate service. Peloton acknowledged operations would continue with supply restrictions “for the foreseeable future.”
“As we rapidly scale our organization to meet the extraordinary demand for our products, we realize that some of our members have faced extended delays associated with receiving our products or having support requests fulfilled,” CEO John Foley said in a letter to shareholders.
The company reported earnings of USD0.20 per share in comparison to the anticipated USD0.11 a share. Revenue amounted to USD757.9 Million compared to analysts expected USD748.1 Million.