In order to “help people be the best version of themselves,” Peloton is permanently reducing the price of its Bike from $1,895 to $1,495. For those who are interested in a Pelton Bike, the reduced pricing is a killer deal, though it comes at a time when investors are growing wary of the company.
Peloton has had a rough year, to say the least. It was forced to recall its treadmills following over 70 injury reports and the death of a child, which the company’s CEO blamed on poor parental supervision in a now-inaccessible blog post (here’s an archived version). The company has done a good job improving the safety of its treadmills since then, though not without running into some bad press due to software issues.
These recalls and scandals may have led to reduced sales, as Peloton now reports poor earnings and a stunted revenue outlook for its first quarter. And if that’s not enough, the company says that it found a discrepancy in its year-end inventory counts, which is a fancy way of saying that it isn’t 100% sure how many products it’s sold.
The company’s poor outlook, inventory screw-up, and $400 Bike discount led to a 7% decline in shares on August 26th, which shouldn’t come as much of a surprise. But to be fair, investors may have been over-optimistic at the beginning of the COVID-19 pandemic, as lockdowns gave a sustained boost to the home gym market.
For those who are interested in working out at home, the Peloton Bike is still a killer product, and the new $1,495 price only makes it a more accessible product. With a $40 per month Peloton All-Access Membership, Bike owners can unlock tons of guided workouts, track their progress over time, and even connect to a leaderboard to compete with others.