Peloton Shares Fall >15% on FY2027 Outlook

Peloton Shares Fall >15% on FY2027 Outlook

Peloton's shares dropped more than 15% in pre‑market trading by 07:40 ET after the company issued a fiscal 2027 revenue outlook that fell short of Wall Street expectations, despite a fourth‑quarter earnings beat.

The company posted fourth‑quarter earnings per share of $0.13, marginally above the analyst consensus of $0.12. Quarterly revenue reached $608 million, flat year‑over‑year and ahead of the $597.44 million consensus estimate. Subscription revenue increased 7% year‑over‑year to $436.6 million, whereas revenue from connected‑fitness products declined 14% to $171.1 million. Adjusted EBITDA rose $2 million year‑over‑year to $142 million, and total gross margin improved by 260 basis points to 56.7%.

Paid connected‑fitness subscriptions at period end totaled 2.553 million, a decrease of 247,000 units or 8.8% year‑over‑year, but remained within the company's guidance range.

Looking ahead, Peloton guided first‑quarter fiscal 2027 total revenue to a range of $545 million‑$565 million, below the $566.7 million consensus. The company expects adjusted EBITDA of $135 million‑$145 million for the quarter, representing a $22 million (18.4%) increase year‑over‑year at the midpoint, and a gross margin of approximately 57.0%, up 550 basis points year‑over‑year.

For the full fiscal year 2027, Peloton projected total revenue of $2.3 billion‑$2.4 billion, under the $2.43 billion consensus estimate. Adjusted EBITDA is forecast between $475 million and $525 million, an increase of $32 million or 6.8% year‑over‑year at the midpoint, with an expected gross margin of roughly 54.0%, up 140 basis points year‑over‑year.