Peloton shares slump as soft outlook overshadows fiscal Q4 beat

Investing.com -- Peloton shares fell sharply after the fitness equipment maker issued a soft revenue outlook for fiscal 2027 that came in below Wall Street expectations, overshadowing a fourth-quarter earnings and revenue beat.

Shares slumped more than 15% in premarket trading by 07:40 ET.

The company reported fourth-quarter earnings per share of $0.13, just above the analyst estimate of $0.12. Revenue came in at $608 million, flat year-over-year, and ahead of the $597.44 million consensus estimate.

Subscription revenue rose 7% year-over-year to $436.6 million, while connected fitness products revenue fell 14% to $171.1 million.

Adjusted EBITDA rose $2 million year-over-year to $142 million. Total gross margin rose 260 basis points year-over-year to 56.7%.

Ending paid connected fitness subscriptions totaled 2.553 million, down 247,000, or 8.8%, year-over-year, within the company’s guidance range.

For the first quarter of fiscal 2027, Peloton guided to total revenue of $545 million to $565 million, below the $566.7 million consensus. It expects adjusted EBITDA of $135 million to $145 million, up $22 million, or 18.4%, year-over-year at the midpoint, and total gross margin of approximately 57.0%, up 550 basis points year-over-year.

For the full 2027 fiscal year, Peloton guided to total revenue of $2.3 billion to $2.4 billion, below the $2.43 billion consensus. The company expects adjusted EBITDA of $475 million to $525 million, up $32 million, or 6.8%, year-over-year at the midpoint, and total gross margin of approximately 54.0%, up 140 basis points year-over-year.

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