This probably falls under “good problems” in the grand scheme of things. After another record quarter, Peloton has announced that it will be investing more than $ 100 million in air and ocean shipments as the wait times for our products to be delivered are longer than acceptable.
The fitness company is one of those technology companies that have seen tremendous interest in the pandemic. In fact, VCs don’t seem to be pumping money into fitness at home solutions fast enough to satisfy their interest these days. 2020 was a banner year for home exercise solutions, from LuluLemon’s acquisition of Mirror for $ 500 million to new platforms from Apple and Samsung.
Overall, Peloton posted revenue of $ 1.06 billion in the most recent quarter, an increase of more than 200% year over year. The numbers exceed Wall Street’s expectations and show no signs of slowing. Another massive quarter is expected for the connected fitness brand.
The market has pulled back slightly as Peloton admitted, “While this investment will dampen our short-term profitability, improving our member experience is our number one priority.” This heavy spending on reducing supply bottlenecks is clearly a longer term game.
It remains to be seen, of course, how the company’s profits will stabilize after the pandemic. I would expect Peloton and other brands to slow down a bit if vaccines make gym return a widespread phenomenon. Nonetheless, home training – like remote work – can be an aspect that changes radically from the rear, even with COVID-19.