Peloton Interactive Stock Earnings Reports

Peloton reported a solid Q3 FY2025: results came in at the high end or above guidance with sequential subscription growth in a seasonally strong quarter, improved unit economics, positive adjusted EBITDA ($89M) and positive free cash flow ($95M). Paid Connected Fitness subscriptions were 2.88M (net +5k Q/Q, -6% Y/Y); Paid App subs were 573k. Total revenue was $624M (subscription mix 67%), total gross margin 51% (+780bps Y/Y). Management is tracking ahead of a $200M cost restructuring target and raised FY25 guidance (narrower ranges, slightly higher midpoints) including adjusted EBITDA guidance to $330–$350M and free cash flow guidance roughly $250M for the year. Key strategic priorities under new CEO Peter Stern: (1) improve member outcomes (better cardio, holistic wellness, personalized coaching); (2) “meet members everywhere” (retail micro-stores, gyms/commercial via Precor, campuses, international expansion aided by AI translation); (3) create members for life (improve service, community features like Teams); and (4) operate with business excellence (pricing, promotions, continued cost reduction). Management is actively hiring for CIO, CMO and Chief Communications Officer and added a COO and CCO to accelerate manufacturing, commercial expansion and retail/gym distribution. AI is being deployed across member support, content translation and Personalized Plans (nearly 500k plans started). Balance sheet: $914M cash, net debt down ~35% Y/Y to $585M, trailing 12‑month adjusted EBITDA $334M. Risks called out: tariff exposure (25% on aluminum content affecting Q4 / FY25 free cash flow by ~ $5M), ongoing macro sensitivity for hardware demand, and convertible notes (~$200M) due Feb next year. Overall, the company is focused on sustaining profitable operations, deleveraging the balance sheet, and executing a multipronged plan to return to durable top-line growth over time.