Peloton Interactive Inc., the popular at-home fitness equipment company, is currently facing a potential buyout by private equity firms as it navigates through a period of business turnaround plans. The company recently reported worse-than-expected third-quarter results, which included a 4.2% decrease in sales year over year and an EPS loss that missed analyst estimates.
In addition to the disappointing financial results, Peloton also announced the departure of CEO Barry McCarthy and the appointment of interim co-CEOs. The company has implemented a restructuring program that involves a global headcount reduction and a cut in their full-year revenue outlook. These changes come as Peloton’s market capitalization has dropped dramatically, and the stock has plummeted 52% in the last 12 months.
Despite these challenges, some investors see potential in Peloton stock, with shares up 12.8% at last check on Tuesday. For those looking to gain exposure to Peloton, they can consider investing in BNY Mellon Innovators ETF and IShares Virtual Work And Life Multisector ETF, which have holdings in the company.
Peloton is currently facing various obstacles, including high production costs, product recalls, and declining demand for expensive at-home exercise equipment. The company is also holding $1.7 billion in debt as of March 31, 2024. As Peloton explores the possibility of going private with at least one private equity firm, the future of the company remains uncertain as it strives to overcome its current challenges and regain investor confidence.
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