Peloton had been sitting on quite a pedestal of late — with its loyal fan base willing to pay a premium price for its bikes and streaming service. But after the less-than-stellar IPO performance and a recent lawsuit, cracks at the company may be starting to appear.
The Skift Wellness newsletter is our weekly dispatch focused on what’s happening in wellness from a global business standpoint. Skift Wellness lives where wellness meets commerce, mindfulness meets technology, the yoga studio meets the boardroom, and health meets business.
Ask any fitness-loving friend about Peloton, and you’ll probably hear rave reviews about the brand. Those who want one of its coveted bikes will swoon over it, and those who already have one will likely tell you all about it … and then some. Peloton’s customer base is growing, and among the fitness community, Peloton remains the It brand.
And yet, the company’s IPO last Thursday was anything but a victory lap. The shares, priced at $29, instead opened at $27 and closed the first day of trading at $25.76. And one point, shares were down as much as 15 percent.
CEO John Foley told Bloomberg he felt “some disappointment” after the lackluster performance. One theory for the slump? Companies like WeWork that focus on growth but burn through cash and post big losses are spooking investors.
Still, Foley said that even with the off day, the company is fully funded and can focus on adding more of those oh-so-passionate subscribers.
In other at-home fitness news, Nintendo is making big moves in the gaming workout space, with its launch of Ring Fit Adventure. Our guess is that it will appeal to a different sector than the Peloton crowd and thus find its own large and loyal audience — especially if it’s anything like the still-popular Wii Fit.
Over the coming weeks, we’ll have to wait and see how Peloton’s public listing plays out and whether it can start making enough money to justify the market valuation of more than $7 billion.
In the meantime, you can go back to listening to — or tuning out — your friends’ rave reviews of the brand.
— Leslie Barrie, Wellness Editor
Peloton’s IPO Gets Off to Slow Start: Peloton saw its shares tumble 11 percent in its first day of trading last week. Many see the initial slump as a warning sign that investors are growing weary of companies like Peloton, Uber, and WeWork who burn through money in order to grow. By June 30, even though Peloton’s revenue doubled, it still reported a loss of $196 million. While the slow start isn’t promising, its fan base is still signing up, full speed ahead. Read more here.
Can Video Games Take On Peloton? Despite Peloton’s IPO slump, working out at home is back in fashion. While Peloton is getting most of the at-home fitness buzz these days, Nintendo is quietly dominating the exercise-meets-gaming space. Wii Fit is still wildly successful, as is Just Dance. Now with the launch of its Ring Fit Adventure, Nintendo has a full range of fitness offerings — but it’s unclear whether it can steal some of Peloton’s customers. Read more here.
Food & Drink
The Latest Wellness Fad Is Going Back to Basics: Fresh Fruit: Americans aren’t drinking as much juice as they used to. Numbers haven’t been this low since the government started tracking in 1970s. One reason for the decline: Fruit juice was primarily marketed as a wellness product, but it’s high in sugar — which is currently demonized by the wellness set. So as more people shy away from the sweet stuff, they’re opting for whole fruits and berries instead. Could this trend lead to green juice taking a hit as well? Read more here.
Amazon and Puma Team Up on New Athleisure Line: The Everything Store may be aiming to one day take on Nike, with the launch of its new athleisure line, Care Of, in partnership with Puma. It’s an odd pairing, considering Puma could lose customers to Amazon — though the sportswear company claimed the new line reaches a different audience. Our guess: Amazon must have paid well. To come up with the offerings, Amazon used review and search analytics. We’ll see if it works. Read more here.
CBD Has Taken Over the Beauty Industry: It’s one thing to apply a cream with CBD oil to a sore spot on your body. After all, pain relief is one of CBD’s purported claims. It’s another thing to buy CBD-infused lip gloss and shampoo. Why does it even need to be in there? Since the Farm Bill passed in 2018, CBD beauty has skyrocketed — with CBD brands on shelves in stores including CVS and Ulta. The influx of products, though, could create CBD fatigue, which may hurt the whole industry. Read more here.
Skift Wellness Editor Leslie Barrie [firstname.lastname@example.org] curates the Skift Wellness newsletter. Skift emails the newsletter every Thursday.
Photo credit: WestinWORKOUT guest rooms feature Peloton bikes for guests to use in their own rooms. Peloton's IPO last Thursday flopped as its stock plunged 11 percent the first day of trading. Westin Hotels & Resorts