Peloton achieved profitability in fiscal 2026, posting net income of $63.2 million compared with a loss of $118.9 million in the prior year. The turnaround was aided by price increases implemented in the previous fall across the company’s hardware and subscription offerings. Despite this milestone, the company’s stock declined sharply in morning trading as Wall Street reacted to guidance suggesting sales challenges ahead.
For the fiscal fourth quarter ended June 30, Peloton reported net income of $61.6 million, or 13 cents per share, versus $21.6 million, or 5 cents per share, a year prior. Quarterly sales rose modestly to $607.7 million from $606.9 million in the comparable period. However, full-year fiscal 2026 sales declined compared to the previous year despite the price increases. The company provided guidance for fiscal 2027 projecting sales between $2.3 billion and $2.4 billion, representing a decline of nearly 4% and falling short of the $2.42 billion analyst consensus.
CEO Peter Stern characterized fiscal 2026 as a “landmark” year for the company’s financial performance and noted that positive free cash flow is expected to continue in fiscal 2027, with anticipated growth in gross margin and adjusted earnings metrics. Stern acknowledged challenges remain, stating that while the company is improving customer acquisition and connected fitness sales while maintaining flat churn rates, it has not yet achieved positive net subscriber growth.
To address engagement and retention challenges, Peloton appointed Sarah Robb O’Hagan as chief content and member development officer. The company is pursuing multiple growth initiatives, including a partnership with Spotify and plans to launch commercial versions of its Bike and Tread equipment for use in commercial fitness facilities later this year. Stern indicated substantial interest from potential gym partners, though no sales agreements had been finalized yet as the company was still establishing pricing for the commercial equipment.
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