Peloton Wows Wall Street With Unexpected Revenue Growth
Peloton stock is soaring Thursday after the company reported its first year-over-year sales growth in nine quarters. Here's what you need to know.
Peloton Interactive (PTON) stock is trading notably higher in Thursday's session after the connected fitness company beat top- and bottom-line expectations for its fiscal fourth quarter.
In the three months ended June 30, Peloton's revenue increased 0.2% year-over-year to $644 million, marking its first annual revenue growth since the second quarter of its fiscal 2022. The company's net loss per share narrowed to 8 cents from 68 cents in the year-ago period.
"We ended the 2024 fiscal year with strong Q4 performance, meeting or exceeding our guidance on all key metrics and making continued progress on a number of our financial goals," Peloton said. "With a stable financial foundation now in place, we can focus on innovation in a more strategic way, enhancing our Member experience and driving sustainable, profitable growth over the long term."
Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
The company's results handily beat analysts' expectations. Wall Street was anticipating revenue of $631 million and a net loss of 17 cents, according to CNBC.
Here's what Peloton expects to accomplish in the first quarter and full year of fiscal 2025:
Metric | Q1 2025 | FY 2025 |
---|---|---|
Revenue | $560 million to $580 million | $2.4 billion to $2.5 billion |
Adjusted EBITDA | $50 million to $60 million | $200 million to $250 million |
For the first quarter of PTON's fiscal 2025, analysts anticipate revenue of $609 million and adjusted EBITDA (earnings before interest, taxes, depreciation and amortization) of $45 million. While the company's revenue forecast is below the Street's expectations, its higher EBITDA outlook reflects a focus on long-term profitable growth.
For the full-year, analysts are calling for revenue of $2.7 billion.
Is Peloton stock a buy, sell or hold?
Peloton has put Wall Street through the wringer since its pandemic peak. This year alone, shares are down nearly 29% – including Thursday's post-earnings surge. Unsurprisingly, Wall Street is on the sidelines when it comes to the consumer discretionary stock.
According to S&P Global Market Intelligence, the consensus analyst target price for PTON stock is $4.75, representing implied upside of more than 14% to current levels. Meanwhile, the consensus recommendation is a Hold.
Financial services firm UBS Global Research is even more bearish on the stock, with a Sell rating and a $2.50 price target.
"We believe consistent momentum in positive growth in total interactive visits could signal traction in demand, but we are also mindful of seasonal promotional activity that could temporarily impact these metrics over shorter periods," wrote UBS analyst Arpine Kocharyan in an August 13 note. "We believe investors remain focused on 2025 connected fitness subscription growth, especially as it becomes evident that the tiered app membership approach and the relaunched app did not drive the conversion to connected fitness many were expecting."
Related Content
Get Kiplinger Today newsletter — free
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.
Joey Solitro is a freelance financial journalist at Kiplinger with more than a decade of experience. A longtime equity analyst, Joey has covered a range of industries for media outlets including The Motley Fool, Seeking Alpha, Market Realist, and TipRanks. Joey holds a bachelor's degree in business administration.
-
Is PLAY Stock a Buy After a Dave & Buster's Earnings Beat?
PLAY stock is higher Wednesday after the entertainment and restaurant chain reported strong Q2 earnings, but what does Wall Street have to say?
By Joey Solitro Published
-
GameStop Sinks on Revenue Drop, Stock Offering: What to Know
GameStop stock is plunging Wednesday after the video-game retailer said sales declined in Q2 and that it's selling shares to raise cash.
By Joey Solitro Published
-
Is PLAY Stock a Buy After a Dave & Buster's Earnings Beat?
PLAY stock is higher Wednesday after the entertainment and restaurant chain reported strong Q2 earnings, but what does Wall Street have to say?
By Joey Solitro Published
-
GameStop Sinks on Revenue Drop, Stock Offering: What to Know
GameStop stock is plunging Wednesday after the video-game retailer said sales declined in Q2 and that it's selling shares to raise cash.
By Joey Solitro Published
-
Saving to Be a 401(k) Millionaire? Plan for Taxes Now
Your tax bite in retirement could be excruciating. Here's why super savers need to get serious about protecting themselves.
By Brian Gray Published
-
Considering a 721 Exchange? Adopt a Buyer Beware Mindset
Having a tax-smart exit strategy for your real estate investment is a great idea, but if a 721 exchange is part of your plan, here's what you need to consider.
By Dwight Kay Published
-
Stock Market Today: Stocks End Mixed Ahead of August CPI Report
Sharp losses for blue chip banks JPMorgan and Goldman Sachs pressured the Dow Jones Industrial Average.
By Karee Venema Published
-
Hewlett Packard Sinks on $1.35 Billion Stock Offering: Why This Matters
Hewlett Packard stock is spiraling Tuesday after the PC maker said it's selling stock to raise money for its Juniper acquisition. Here's what you need to know.
By Joey Solitro Published
-
Apple Stock Drops on News of Hefty Irish Tax Bill: What to Know
Apple stock is down Tuesday after the European Union ruled the tech giant must pay Ireland 13 billion euros in back taxes. Here's what that means for investors.
By Joey Solitro Published
-
Is Oracle Stock a Buy After Earnings Beat, Amazon Alliance?
Oracle stock is rallying Tuesday after the tech firm beat earnings expectations and announced a new AWS partnership. Here's what you need to know.
By Joey Solitro Published