Peloton Interactive Inc said on Thursday its near-term profitability would suffer due to a decision to slash the price of its exercise bike and higher commodity and marketing costs.
A Peloton exercise bike is seen after the ringing of the opening bell for the company's IPO at the Nasdaq Market site in New York City, September 26, 2019. REUTERS/Shannon Stapleton/File Photosaid on Thursday its near-term profitability would suffer due to a decision to slash the price of its exercise bike and higher commodity and marketing costs.
The moves, aimed at making its bikes more affordable, will weigh on its performance in the first quarter. The company's revenue forecast of $800 million was below analysts' average estimate of $1.01 billion, according to Refinitiv data.Peloton's original bike will now cost $1,495, compared with $1,895 earlier, and the company will also shift its product sales mix towards its treadmill.
In the near term, it plans on prioritizing subscription growth and reducing the time gap between sales and delivery.
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