Market Watch: Peloton Plunges, Planet Fitness Surges

Last week, Peloton’s pandemic bubble popped. Meanwhile, Planet Fitness surged. Hardly an apples-to-apples comparison, exercise seekers are proving hard to pin down.

Miss. Since reporting its Q1 2022 earnings last week, Peloton has shed more than $10B in market cap.

  • The connected fitness company missed earnings estimates of $810.7M, reporting $805.5M, as losses widened.
  • A red flag, Peloton scaled back its FY2022 revenue forecast by up to $1B.
  • As demand for its connected equipment softens, existing members are less engaged, with average monthly workouts reportedly sinking to 16.6 from a high of 26.

As the stock cratered, on Friday, Peloton instituted a hiring freeze across all departments. Year to date, the stock is down more than 63% with a market cap of ~$15.5B, down from $44B in January.

Beat. On the flip side, Planet Fitness beat earnings and revenue estimates, as memberships approach pre-pandemic levels.

  • Membership topped 15M, representing 97% of its pre-COVID peak.
  • Total revenue was up 46% YoY to $154.3M.
  • Net income reached $18.6M versus a loss of $3.3M in the prior-year period.

Looking ahead, Planet Fitness raised its full-year outlook, forecasting $570–580M in revenue with 110–120 new locations. The gym chain’s stock is up more than 23% year to date.

The big picture: While the Pelotons of the world downplay recent developments, brick-and-mortar operators like Planet Fitness are taking a victory lap.

There’s no denying that the gym is being unbundled. But it’s also true that Peloton and digital/at-home fitness companies have had their growth juiced for nearly 24 months. Now, as the playing field levels, every move and every metric will be scrutinized.

Punchline: No one actually knows where consumer preferences will land. Sure, omnichannel offerings will be a piece of the puzzle. But, between at-home and in-person fitness, neither camp is in the clear. Best case, exercise seekers are the real winners, as increased access, convenience, and personalization lead to meaningful health outcomes.

Breaking down the business of fitness and wellness

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