Peloton Cut to Underperform at Bank of America on Fading User Engagement
- Analyst flags drop in number of classes taken per subscriber
- Shares are down 97% from a record high in January 2021
Peloton shares are down 97% from a peak in January 2021 as the company has faced slowing demand with people returning to offices and gyms following the pandemic.
Photographer: Adam Glanzman/BloombergPeloton Interactive Inc. picked up another sell-equivalent rating on Thursday as Bank of America Corp. downgraded the fitness company on concern around the outlook for subscriber results.
Analyst Curtis Nagle said his review of three years of data for top Peloton cycling instructors shows a steep drop in the number of classes taken per subscriber, signaling declining user engagement. Meanwhile, consumers who subscribed to Peloton’s fitness programs during the Covid-19 pandemic are nearing the average user lifetime of about five years, further increasing the risk of subscriber churn.