Loading...
•
Mar 31, 2020
Peloton Q3 2020 Earnings Report
Peloton's revenue and subscriber base grew significantly, driven by increased demand during the COVID-19 crisis, while also raising full-year guidance.
Key Takeaways
Peloton Interactive, Inc. reported a 66% increase in total revenue to $524.6 million for Q3 2020, driven by a 94% growth in Connected Fitness Subscribers, which reached over 886,100. The company's average net monthly connected fitness churn was 0.46%, and total members grew to over 2.6 million. Despite a net loss of $55.6 million, adjusted EBITDA was $23.5 million, representing a 4.5% adjusted EBITDA margin. Peloton raised its FY2020 guidance, expecting 1.04 million to 1.05 million ending Connected Fitness Subscribers and $1.72 billion to $1.74 billion in total revenue.
Total revenue increased by 66% to $524.6 million.
Ending Connected Fitness Subscribers grew by 94% to over 886,100.
Average Net Monthly Connected Fitness Churn was 0.46%, the lowest level in four years.
Adjusted EBITDA was $23.5 million, with an Adjusted EBITDA Margin of 4.5%.
Revenue by Segment
Forward Guidance
Peloton provided Q4 and full fiscal year 2020 business outlook, including revenue and adjusted EBITDA guidance.
Positive Outlook
- Expects $500 million to $520 million in total revenue for Q4, representing 128% growth at the midpoint.
- Projects $55 million to $65 million in Adjusted EBITDA for Q4, with an 11.8% Adjusted EBITDA Margin at the midpoint.
- Anticipates subscription contribution margin of 63.0% to 64.0% for Q4.
- Expects better Connected Fitness reactivations and elevated levels of Member engagement to continue.
- Forecasts $1.72 billion to $1.74 billion in total revenue for full fiscal year 2020, an 89% growth at the midpoint.
Challenges Ahead
- Anticipates elongated order-to-delivery windows due to unexpected sharp increase in sales.
- Expects Connected Fitness Product Gross Margin to decline year-over-year to 40.0% to 41.0% due to additional shipping costs and COVID-19 related costs.
- Assumes Tread sales will not resume prior to the end of fiscal year 2020.
Revenue & Expenses
Visualization of income flow from segment revenue to net income
Historical Earnings Impact
Analyze how earnings announcements historically affect stock price performance
Avg. Return Before/After Earnings
Loading earnings performance data...
Loading earnings reaction data...