Report: Peloton app is losing users every month
- Average daily users on Peloton's app tanked 42% from April through July.
- In comparison, competitor iFit reported a much narrower 16.5% decline only.
- Shares of the exercise equipment maker are 3.0% down on the intraday chart.
Peloton Interactive Inc (NASDAQ: PTON) can’t seem to catch a break this year.
Days after the exercise equipment manufacturer said easing COVID-19 restrictions were weighing on sales growth, Forbes cited data from Apptopia on Friday that suggested use of the Peloton app had dropped 42% since April.
Possible reasons for the slowdown
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Earlier this year, Peloton was also made to recall its flagship treadmill after several reports of injuries, with one also implicating the product in the death of a child.
The Forbes report this morning attributed the sharp decline in the use of the Peloton’s app to people choosing to go to the gym over home workouts, now that they are vaccinated, and restrictions are easing. The other explanation, the report added, could be that their Peloton Tread+ was recalled.
Competitors are seeing a less steep decline
A decline from the peak of the pandemic was a given for companies that relied on home fitness. Peloton’s competitors, however, are seeing a slowdown that’s nowhere near as steep. iFit, for example, reports a 16.5% decline only over the past four months.
More alarming for Peloton is that it noted a steady decline in users from April through July. The decrease in August, though, was narrower than the previous months.
Performance in the stock market
Shares of the company are about 3.0% down on the intraday chart after the Forbes report. On a year-to-date basis, the stock is now down more than 30%.
On the flip side, however, Peloton is a stock that climbed by 700% last year when the Coronavirus restricted people to their homes. Many would, therefore, argue that a bit of a pullback was in the books. In that league is Needham’s Bernie McTernan, who raised his price target on PTON last week to $135 that represents an over 30% upside from here.