Peloton (NASDAQ:PTON) shares were down sharply Friday, on pace to hit a 17-month low, after the at-home fitness equipment maker slashed its annual sales forecast by as much as $1 billion.
At least four Wall Street investment firms downgraded the stock after Peloton’s dismal fiscal first-quarter financial report released Thursday.
While the company — and its share price — experienced incredible growth a year ago due to stay-at-home trends sparked by the coronavirus pandemic, that momentum is fading and more consumers are heading back to gyms. Planet Fitness, for example, said Thursday that its membership levels are almost back to a pre-pandemic peak. That stock hit an all-time high on the news.
"From forecasting consumer demands to accurately predicting logistics costs, our teams have never seen a more complex operating environment in which to guide our expected results this year," Peloton CEO John Foley said on the company’s earnings conference call.
Foley added that Peloton has seen traffic to its website taper off faster than the company was anticipating in recent months. Shopper visits to its brick-and-mortar stores also underwhelmed, he said.
Putting even greater pressure on Peloton’s profits, the company cut the price of its original Bike product by 20% in August. Executives said Thursday that the reduction helped to accelerate Bike sales, but that also means fewer people are choosing to buy its more expensive Bike+.
PTON shares dipped $29.05, or 33.8%, to begin Friday at $57.01.
