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Dec 31, 2023
Peloton Q2 2024 Earnings Report
Reported strong Q2 results, outperforming on paid subscribers to Connected Fitness and App, gross margin, and free cash flow.
Key Takeaways
Peloton reported Q2 2024 results, outperforming expectations for paid subscribers, gross margin, and free cash flow. While revenue growth remains a challenge, the company is focused on restoring positive free cash flow and revenue growth in the coming quarters.
Ending Paid Connected Fitness Subscriptions increased to 3.004 million.
Average Net Monthly Paid Connected Fitness Subscription Churn was 1.2%.
Ended the quarter with 718 thousand Peloton App subscribers.
Total revenue was $743.6 million.
Peloton
Peloton
Peloton Revenue by Segment
Revenue by Segment
Connected Fitness Products Revenue
CapyFin.comSubscription Revenue
CapyFin.com Forward Guidance
The company's Q3 outlook includes expectations for Paid Connected Fitness Subscriptions, Paid App Subscriptions, Total Gross Margin, and Adjusted EBITDA. The full year guidance reflects hardware sales trends, Bike rental program growth, and Tread+ revenue, tempered by uncertainties in subscriber growth and the macroeconomic outlook.
Positive Outlook
- Expects a similar Paid Connected Fitness Churn rate similar to Q2.
- Expects a sequential improvement in gross additions due to seasonality coupled with continued improvements to our conversion funnel.
- Expects a sequential increase in Q3 total gross margin as a result of an improvement in Connected Fitness gross margin due to the introduction of Tread+ deliveries along with a smaller impact from seasonal mix-shift toward our Subscription segment.
- Expects a sequential improvement in Q3 Adjusted EBITDA mainly due to lower sales and marketing expense.
- Faster growth for our Bike rental program and revenue from deliveries of Tread+.
Challenges Ahead
- Uncertainty surrounding our ability to efficiently grow Paid App subscribers
- Performance of other new initiatives
- An uncertain macroeconomic outlook.
- Expectation that churn will follow our historical seasonal pattern, which includes a seasonal increase in paused subscriptions in Q4.
- Current trends for hardware sales will persist through the remainder of fiscal year.
Revenue & Expenses
Visualization of income flow from segment revenue to net income