Interactive fitness platform provider Peloton Interactive, Inc. PTON stock jumped during premarket trading on Thursday after the company reported better-than-expected fourth-quarter results.
The company reported sales of $643.6 million, up marginally by 0.2% year over year, beating the consensus of $630.5 million and outperforming the company’s $618 million-$643 million implied guidance range.
“We achieved modest Y/Y revenue growth in Q4 for the first time since Q2 FY22”, the company said.
The subscription segment delivered $431 million of revenue, up 2.3%, while the connected fitness segment revenue fell 4% to $212.1 million.
The company reported a lower-than-expected EPS loss of 8 cents, beating the consensus of 16 cents loss and lower than the 68 cents loss reported a year ago.
The company ended the quarter with 6.4 million members, down 2% year over year. Paid connected fitness subscriptions also fell 1% to 2.981 million.
The maker of exercise bicycles and treadmills reported an adjusted EBITDA of $70.3 million, a turnaround from a loss of $(34.7) million a year ago.
“We delivered positive Adjusted EBITDA and Free Cash Flow for the second consecutive quarter, something we haven’t accomplished since Q2 FY21,” the company added. Paid App Subscriptions reached 615,000, down 26% year-over-year.
The average net monthly paid connected fitness subscription churn stood at 1.9%, and the average monthly paid app subscription churn was 8.4%.
The churn rate, sometimes known as the attrition rate, is the rate at which customers stop doing business with a company over a given period. Churn may also apply to the number of subscribers who cancel or don’t renew a subscription.
Guidance: Peloton Interactive expects continued sales headwinds in the first quarter of 2025 due to an uncertain macroeconomic environment.
It anticipates revenues of $560 million—$580 million versus the estimate of $609 million and fiscal year 2025 sales of $2.4 billion—$2.5 billion versus the estimate of $2.698 billion.
The company expects the first-quarter ending paid connected fitness subscriptions of 2.88 million-2.89 million and 2.68 million-2.75 million for fiscal year 2025.
The fitness equipment maker expects the first-quarter ending paid app subscriptions of 0.56 million-0.57 million and 0.57 million-0.62 million for fiscal year 2025.
Price Action: PTON stock is up 10.40% at $3.71 during the premarket session at the last check on Thursday.
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Photo: courtesy of Peloton
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