NASDAQ$PTON
Peloton Interactive · Q4 2023 earnings
Q4 2023 earnings · · Investor relations
Briefing
Peloton's Q4 2023 performance reflected a seasonal business with subscription growth offset by hardware sales slowdown and higher churn, though positive trends emerged towards the end of the quarter.
Peloton's Q4 FY2023 saw a 4% year-over-year increase in Connected Fitness subscriptions, but a sequential decline due to seasonal hardware sales slowdown and higher churn. Despite these challenges, the company achieved positive free cash flow (excluding the DISH legal settlement). The company is focused on growth initiatives, including new app subscription tiers and partnerships.
- Connected Fitness subscriptions grew 4% year-over-year but declined sequentially due to seasonal factors and higher churn.
- The seat post recall impacted sales and subscriptions, with approximately 750,000 requests for replacement seat posts.
- The company achieved positive free cash flow (excluding the DISH legal settlement) for the second time in its turnaround.
- New initiatives, including rental services and app subscription tiers, show early signs of success.
Headline financials
Revenue & EPS history
Peloton · Revenue · Quarterly
$642M
Revenue by segment
Peloton · $642M total across 2 segments · Q4 2023
- Subscription$422M+10.1%65.7%
- Connected Fitness Products$220M-25.4%34.3%
Forward guidance
Peloton anticipates revenue between $580 million and $600 million for Q1 FY24. Gross margin is expected to be between 46.5%. Adjusted EBITDA is projected to be between -$20 million and -$10 million.
Tailwinds
- Continued improvements in cost structure and operational efficiency.
- Modest continued mix-shift in Q1 revenues to subscription versus hardware revenues.
- Modest sequential improvement to Average Net Monthly Paid Connected Fitness churn.
- New growth initiatives (such as our new App subscription tiers) are challenging to forecast.
- Paid App Subscription guidance reflects continued marketing investment to drive awareness and growth of our free app tier users.
Headwinds
- App marketing spend will be relatively inefficient in driving Paid App subscriber gross additions in the near term.
- A substantial majority of costs incurred in connection with the development of internal-use software will not be eligible for capitalization and will be recognized as research and development expense.
- Lower than historical capital expenditures and higher research and development expense.
- Unforeseen and significant headwinds
- Continue to pursue significant new growth initiatives (such as our new App subscription tiers) that are challenging to forecast.
Historical earnings impact
How earnings announcements have historically affected this stock's price.
Avg. return before/after earnings
Based on 20 quarterly earnings reports · overlaid with Q4 2023
+0.1%
Avg return
Earnings day
+0.5%
Avg return
5 days after
+1.8%
Avg return
30 days after
52%
14 / 27 earnings
Positive
+44.0%
Q4 2024
Best reaction
-38.1%
Q1 2022
Worst reaction
| Quarter | Report date | Reaction (Day 0) | +5 days | +30 days |
|---|---|---|---|---|
| Q3 2026 | +8.5% | +3.5% | +10.8% | |
| Q2 2026 | -25.7% | -26.4% | -35.2% | |
| Q1 2026 | +13.8% | +11.2% | -4.3% | |
| Q3 2025 | -6.9% | -2.4% | +4.6% | |
| Q2 2025 | +12.0% | +15.3% | -18.1% | |
| Q1 2025 | +9.0% | +15.2% | +55.5% | |
| Q4 2024 | +44.0% | +43.5% | +45.8% | |
| Q3 2024 | +6.5% | +27.0% | +13.0% | |
| Q2 2024 | -23.7% | -21.2% | -17.3% | |
| Q1 2024 | +8.3% | +1.2% | +29.3% | |
| Q4 2023 | -21.1% | -16.2% | -36.2% | |
| Q3 2023 | -11.6% | -11.3% | -5.2% | |
| Q2 2023 | +31.3% | +22.1% | +7.2% | |
| Q1 2023 | +8.8% | +11.0% | +54.1% | |
| Q4 2022 | -21.3% | -28.9% | -36.9% | |
| Q3 2022 | -12.7% | +12.3% | -21.3% | |
| Q2 2022 | +30.3% | +16.6% | -24.0% | |
| Q1 2022 | -38.1% | -44.2% | -51.6% | |
| Q4 2021 | -10.2% | -13.8% | -20.3% | |
| Q3 2021 | +1.4% | +10.2% | +24.7% | |
| Q2 2021 | +0.8% | +0.4% | -28.6% | |
| Q1 2021 | +5.8% | -11.3% | -3.5% | |
| Q4 2020 | -7.8% | -6.3% | +34.9% | |
| Q3 2020 | +21.8% | +18.2% | +26.7% | |
| Q2 2020 | -13.4% | -14.6% | -25.4% | |
| Q4 2019 | -0.5% | +5.7% | +43.5% | |
| Q1 2020 | -6.5% | -4.4% | +27.2% | |
| Q3 2019 | — | — | — | |
| Q2 2019 | — | — | — | |
| Q1 2019 | — | — | — | |
| Q4 2018 | — | — | — | |
| Q3 2018 | — | — | — |
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