(Reuters) -Peloton Interactive trimmed its full-year revenue forecast amid a years-long efforts to turn around the business, sending the exercise equipment maker’s shares down about 21% on Thursday.
The company now expects full-year 2024 revenue to be between $2.68 billion and $2.75 billion, down from its previous forecast of between $2.70 billion and $2.80 billion.
It ended with 3 million connected-fitness subscribers in the second quarter, above FactSet estimates of 2.99 million.
Peloton, which was one of the biggest beneficiaries of COVID-19 lockdowns, has stuck partnerships with Amazon.com and Lululemon Athletica to make its products and services more accessible.
It is also betting on a boost from the reintroduction of the high-end Tread+ priced at $5,995, two years after sales were temporarily halted due to safety concerns.
Still, demand for its equipment was lower than expected as inflation-weary customers pulled back on spending during the holiday season, typically its strongest for hardware sales.
“While our paid subscriptions for connected fitness outperformed our expectations, our hardware sales were a bit softer than we expected,” Chief Financial Officer Elizabeth Coddington said on a call with analysts.
Peloton now expects to generate positive free cash flow in Q4 but said it would fall short of achieving positive free cash flow for the full year.
Revenue fell 6.2% to $743.6 million but beat analysts’ expectations of $733.5 million, according to LSEG data.
The company said it expects third-quarter revenue to come in between $700 million and $725 million, below analysts’ estimates of $753.8 million.
(Reporting by Kannaki Deka in Bengaluru; Editing by Maju Samuel and Sriraj Kalluvila)
