Revenue will be US$625 million to US$650 million in the fiscal first quarter, the company said Thursday, far short of the US$772 million analysts were predicting. Its loss on an adjusted basis will be US$90 million to US$115 million, compared with an average estimate of about US$93 million.
The Amazon news gave a boost to shares, but they remain down nearly 90 per cent over the past year. After the company published its outlook on Thursday, the stock dropped 6.5 per cent in premarket trading before markets opened in New York. The net loss in the fourth quarter, which ended June 30, included US$415 million in costs related to the comeback plan.
McCarthy’s goal is to make Peloton cash flow positive in the second half of the coming fiscal year. “We continue to make steady progress, but we still have work to do,” he said. In an effort to increase cash flow, the company also hiked prices for its Bike+ model and Tread treadmill by US$500 and US$800, respectively.
“Our test results show the program is driving increased traffic to the top of our marketing funnel and clearly appeals to a younger, more value-conscious consumer,” McCarthy said.
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