Peloton, the fitness company known for its connected exercise bikes, has seen its shares fall after posting a wider-than-expected loss and falling sales due to a bike recall and seasonality.
The company reported a net loss of $55.6 million for the quarter ending June 30, compared to a net loss of $47.9 million in the same period last year. Revenue also fell to $524.6 million, down from $758.9 million in the same period last year.
The company attributed the losses to a recall of its Tread+ exercise bike, which was linked to the death of a child, as well as seasonality. The recall led to a $50 million charge in the quarter, while seasonality led to a $20 million charge.
Peloton also said that it was seeing a slowdown in demand for its connected fitness products, which it attributed to the pandemic. The company said that it was seeing a “modest recovery” in demand in the U.S. and Europe, but that it was still “well below pre-pandemic levels.”
The company said that it was continuing to invest in its digital platform, which it said was “driving strong engagement and retention.” It also said that it was continuing to invest in its international expansion, with plans to launch in Japan and Australia in the coming months.
Despite the losses, Peloton said that it was “well-positioned” to capitalize on the “long-term growth opportunities” in the connected fitness market. The company said that it was “confident” in its ability to “deliver strong financial results” in the future.
Peloton’s shares have fallen more than 20% since the company reported its earnings, but the company remains optimistic about its future. With its digital platform continuing to drive engagement and its international expansion plans, Peloton is hoping to capitalize on the long-term growth opportunities in the connected fitness market.
