Peloton’s revenue climbs 66% on greater demand for fitness equipment in Q3

Peloton Inc. (NASDAQ: PTON) released its quarterly earnings report on Wednesday that posted a massive 66% year over year increase in its revenue in the fiscal third quarter. The company said that its live classes and fitness equipment were greatly in demand as the Coronavirus pandemic restricted people to their homes.

The upbeat Q3 results also encouraged the company to upgrade its full-year sales guidance. As per CEO John Foley, the health crisis is likely to fuel a drastic, long-term change in consumers’ exercise routines.

Following the release of the financial results, Peloton was reported more than 5% up in extended trading on Wednesday.

Peloton’s Q3 financial results versus analysts’ estimates

According to Refinitiv, analysts had anticipated the company to print £394.20 million in revenue in the third quarter. Their estimate for adjusted loss per share was capped at 13.7 pence. In its report on Wednesday, Peloton topped the estimate for revenue posting a higher £424 million in Q3 but its adjusted loss per share expanded to 16.17 pence in the recent quarter.

At £44.94 million, Peloton’s net quarterly loss came in broader than £31.28 million in the same quarter last year. The company cited settlement expenses ascribed to nonrecurring litigation for the quarterly loss.

Peloton’s connected workout equipment including its bikes generated £339.64 million worth of sales in the recent quarter that accounted for 80% of the company’s total quarterly revenue and was 61% higher than the year-ago figure. Subscription revenue, on the other hand, climbed 92% to £79.37 million and represented 19% of Peloton’s total quarterly revenue.

The American exercise equipment and media company now estimates £1.39 billion to £1.41 billion in revenue in fiscal 2020 which will mark an annualized growth of roughly 89%. Originally, the company had forecast its full-year revenue to lie in the range of £1.24 billion to £1.25 billion.

Peloton says showrooms will remain closed for a few more weeks

Peloton had 886,100 connected fitness subscribers at the end of the third quarter. For full-year, it estimates the figure to climb to 1.04 to 1.05 million.

COVID-19 pushed Peloton into closing its 97 countrywide retail stores in March. As per the company, it will take a few more weeks before the showrooms are opened to the public again. In the meantime, Peloton expects some delays in deliveries due to the Coronavirus restrictions.

At £34 per share, Peloton is currently trading at an all-time high in the stock market. The £8.62 billion company is around 40% up year to date.