Peloton Interactive, Inc. PTON recently revealed its Q4 fiscal 2024 results, stunning investors with earnings and revenues that exceeded expectations. The outcome was a roaring success as Peloton’s shares surged by a solid 12% during pre-market trading on Aug 22.
Strong Financial Performance
PTON showcased an adjusted loss per share of 8 cents, well below the anticipated loss of 18 cents, showcasing marked improvement from the 68 cents loss reported in the same period last year. The company recorded revenues of $643.6 million, exceeding the expected $626 million, marking substantial growth compared to the previous year.
The Connected Fitness segment saw revenues of $212.1 million, a 4% decrease from the prior year, while Subscription revenues progressed by 2% year over year, reaching $431.4 million.
Operational Highlights
As of the quarter’s close, Peloton boasted 2.98 million Ending Paid Connected Fitness Subscriptions, with a net decline of 75 thousand. The average net monthly paid Connected Fitness subscription churn was noted at 1.9%. Furthermore, the company registered 615 thousand Peloton App subscribers, indicating a net decrease of 59 thousand, with an average monthly paid app subscription churn at 8.4%.
Cost Efficiency
In the three months ending on Jun 30, 2024, total operating expenses were recorded at $375.3 million, a decline from $426.8 million in the same period the year before. Notably, general and administrative expenses witnessed a reduction of $23.3 million to $186.2 million compared to the previous year.
Future Expectations
Looking ahead to Q1 fiscal 2025, Peloton anticipates a range of 2.88-2.89 million Ending Paid Connected Fitness Subscriptions, reflecting a 3% decline year over year. Ending Paid App Subscriptions are estimated to be in the range of 0.56-0.57 million, with revenues projected between $560 million and $580 million, a 4% decrease compared to the prior year.
For the entirety of fiscal 2025, Peloton predicts Ending Paid Connected Fitness Subscriptions to range between 2.68-2.75 million, a 9% decrease from the previous year. Ending Paid App Subscriptions are expected to be in the range of 0.57-0.62 million, declining by 3% from the year before. Revenues for the fiscal year are forecasted to be between $2,400 million and $2,500 million, marking a 9% decrease from the previous year’s figures.
As of now, the company holds a Zacks Rank #3 (Hold).
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