Peloton annual net profit marks turnaround, but sales outlook sends shares lower
Peloton earned $63.2 million in fiscal 2026, its first annual profit, but projected another year of falling sales.
By Sofia Marchetti · World Affairs Correspondent
2 min read
Peloton’s annual net profit reached $63.2 million for the fiscal year ended June 30, its first full-year profit and operating-income milestone, CNBC reported. Investors focused instead on the connected-fitness company’s forecast for another sales decline, and shares fell nearly 13% in Thursday morning trading, according to CNBC.
The result reverses a $118.9 million net loss in the prior fiscal year. CNBC reported that price increases for Peloton hardware and subscriptions introduced last fall helped the company’s fiscal 2026 profitability.
Why did Peloton shares fall after its annual net profit?
Peloton forecast fiscal 2027 revenue of $2.3 billion to $2.4 billion, a decline of nearly 4% from the preceding year. That range was below the $2.42 billion Wall Street expectation cited by CNBC, based on LSEG data, which overshadowed the annual profit milestone.
Share prices reflect investors’ changing views about a company’s prospects as buyers and sellers trade. Readers can find more on how stock prices are set in the market. In Peloton’s case, CNBC reported that investors were disappointed by the sales guidance.
Management nevertheless expects another year of positive free cash flow in fiscal 2027. The company also expects gross margin and adjusted EBITDA — earnings before interest, taxes, depreciation and amortization — to increase from fiscal 2026, CNBC reported.
How did Peloton’s fourth quarter compare with expectations?
For the quarter ended June 30, Peloton recorded net income of $61.6 million, or 13 cents a share, compared with $21.6 million, or 5 cents a share, a year earlier. Revenue was $607.7 million, narrowly above $606.9 million a year earlier.
The quarterly earnings figure matched the 13-cent analyst estimate tracked by LSEG, while revenue exceeded the $598 million expectation, CNBC reported. The contrast between those results and the share move shows that investors were weighing the coming year’s projected sales more heavily than the quarter’s modest revenue beat.
Chief Executive Peter Stern said Peloton was working to improve connected-fitness sales and customer additions while holding churn flat. Churn measures subscribers who cancel or do not renew; Stern said the company had not yet turned those efforts into net positive growth.
Peloton has also hired Sarah Robb O’Hagan as chief content and member development officer, succeeding Jen Cotter, CNBC reported. The company plans to introduce commercial versions of its Bike and Tread in the fall, though Stern said it was still talking with prospective gym customers and had not begun commercial sales.
This story draws on original reporting from CNBC.