Peloton (PTON) Stock Forecast & Price Target

Peloton Interactive Inc. is experiencing positive momentum, with an anticipated sales increase of 0.1% to $2.49 billion for FY26, alongside an improved adjusted EBITDA forecast increased to $450 million. The company reported a year-over-year gross margin expansion of 660 basis points in its Connected Fitness Products segment, driven by robust engagement metrics, as indicated by a 5% increase in average monthly workout time and a 50% increase since inception. Furthermore, Peloton's commercial segment has shown resilience, contributing to its overall growth outlook, supported by a target increase in free cash flow to $250 million and a positive shift in its fiscal year EBITDA guidance.

Peloton Interactive has experienced a decline in both its Connected Fitness Products and Subscription segments, with Connected Fitness Product revenues down 4.5% year-over-year to $152.4 million and subscription revenues declining 6.5% to $398.4 million. The company’s gross profit margin also fell short of expectations, recorded at 51.5%, and significant reductions in subscriber numbers are anticipated, with guidance suggesting a decrease of 8% year-over-year in connected fitness subscribers. Additionally, projected revenue growth for FY27 has been revised downward to 3.2%, indicating ongoing challenges in sustaining profitability and subscriber retention amid rising membership fees and heightened churn rates.