Peloton’s controversial year and underwhelming sales have made it a takeover target and the at-home fitness giant is drawing interest from potential buyers, including two giants — Amazon and Nike.
Last month, Peloton shareholder Blackwells Capital called for the removal of the company’s CEO, chairman, and co-founder John Foley over concerns about the company’s performance. Blackwells Capital also suggested that Peloton’s board of directors consider a sale.
Despite the challenges, a Peloton sale stands to be significant. Peloton has a market cap of $8.94 billion — a drastic decline from a company-high market cap of $44.38 billion in 2020.
Now, Peloton’s business has piqued the interest of Nike and Amazon, but no deal is imminent.
Peloton’s potential sale follows a tumultuous year for the New York-based company.
- It reportedly lowered its projected apparel revenue for fiscal 2022 from $200 million to $150 million due to supply chain issues and other “macro factors.”
- The company posted a net loss of $376 million in fiscal Q1 compared to a net income of $69.3 million for the same period the year prior.
- Shareholders have lost nearly $40 billion in wealth; Foley has pocketed more than $115 million from selling stock.
Peloton shares rose more than 30% in extended trading Friday after news of a potential sale circulated.
Changes Coming
Peloton recently hired McKinsey & Co. to evaluate its cost structure and potentially eliminate jobs.
The company has discussed closing 15 of its 123 retail locations and announced added delivery and setup costs, citing inflation.