Peloton (PTON) Stock Forecast & Price Target

Peloton Interactive Inc. is projecting a modest sales increase for FY26, with revenues estimated at $2.49 billion and an improved adjusted EBITDA forecast of $450 million, reflecting healthy growth from its Subscription segment. Engagement metrics remain robust, with average monthly workout times up 5% year-over-year and total engagement increasing by approximately 50% since inception, indicating a strong user base and retention strategy. Additionally, the company has adjusted its EBITDA guidance upward, now estimating between $425 million and $475 million, which is ahead of consensus expectations, further supporting a positive financial outlook.

Peloton Interactive Inc. is facing significant challenges, as evidenced by a 6.5% year-over-year decline in subscription revenues, which constitute the majority of the company's income, alongside a 4.5% drop in connected fitness product revenues. The company's gross profit margin fell to 51.5%, which was below market expectations, while connected fitness margins plummeted to 6.9%, significantly impacted by a product recall. Additionally, the guidance for fiscal year 2026 projects a further decrease in revenues by around 2% year-over-year, highlighting ongoing issues related to subscriber churn and lower sales momentum.