Peloton achieved profitability milestones in its fiscal year ended June 30, posting net income of $63.2 million compared with a loss of $118.9 million in the previous year. The turnaround was aided by price increases implemented on hardware and subscription offerings. Despite these gains, the company’s stock declined sharply in morning trading as investors reacted negatively to forward guidance.
For the fiscal fourth quarter ending June 30, Peloton reported net income of $61.6 million, or 13 cents per share, versus $21.6 million, or 5 cents per share, in the year-ago period. Quarterly sales reached $607.7 million, up marginally from $606.9 million a year earlier. However, full-year sales declined compared with the prior fiscal year despite the price increases.
Looking ahead to fiscal 2027, Peloton projected sales to fall nearly 4% to a range between $2.3 billion and $2.4 billion, falling short of analyst expectations of $2.42 billion. CEO Peter Stern described fiscal 2026 as a “landmark” year that positioned the company for long-term growth, though he acknowledged challenges persisted. The company anticipated another year of positive free cash flow while gross margin and adjusted EBITDA would expand year-over-year.
Stern noted that Peloton is gradually improving its connected fitness sales trajectory while maintaining stable customer churn rates, though the company has not yet reached the point where these factors combine for net positive subscriber growth. The company recently hired Sarah Robb O’Hagan as chief content and member development officer to focus on member engagement and reducing subscription cancellations.
Peloton is pursuing additional revenue opportunities, including a partnership with Spotify and preparation to launch commercial versions of its Bike and Tread for traditional gyms in the coming months, though Stern indicated that sales partnerships in that channel have not yet materialized.
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