Peloton’s Financial Troubles Have Users Fearing Loss Of Instructors Pushing Them To Go! Go! Go!

One question locked-down stationary peddlers never asked before shelling out for Pelotons was whether the company would be around long enough to justify their pricey purchases.

A big part of Peloton’s attraction has been the digital interactions it offers, for a monthly fee, with inspirational instructors backed by propulsive music, where users could push themselves harder while feeling part of a movement even when they were sitting in place.

As Peloton has cut thousands of jobs, lost billions of dollars, ditched its CEO and watched 95% of its market capitalization evaporate, it’s natural to ask whether the online training sessions that made Peloton a disruptor of the home-exercise industry might be jettisoned.

“I think people absolutely have that fear,” Simeon Siegel, a senior analyst at BMO Capital Markets who covers Peloton, told Forbes. “Peloton’s troubles appear to be more financial than existential, but I think the fear makes a lot of sense.”

Siegel said it’s unlikely that Peloton equipment will go unsupported anytime soon, especially if there’s money to be made.

“The question is would Peloton disappear,” he said. “I think whatever form Peloton takes, someone would be willing to keep collecting the monthly fees.”

Peloton has taken drastic measures to preserve cash. A tantalizing potential cut it hasn’t undertaken would be the $299 million the company said it plans to spend over the next three fiscal years on music-rights agreements. A Peloton spokesperson, however, said that expenditure isn’t on the chopping block.

“The only intention we have is to expand and enrich our member and prospective member experience,” Ben Boyd, Peloton’s senior vice president of global communications, told Forbes. “We’re focused on our biggest differentiators because we know how valuable they are to our members. Music is certainly one of those, and we know it plays a critical role in the member experience.”

Analysts are split on whether Peloton would be a good buyout target and whether that would affect its interactive offerings. Edward Yruma, a senior research analyst at Piper Sandler, said buying a Peloton bike today would continue to be supported in the future. On the other hand, David Trainer, CEO of financial research firm New Constructs, told Forbes he doubted that anyone would be interested in buying the company.

“Tell me who needs them,” Trainer said. Competitors such as Bowflex and Nordic Track have already adopted the digital innovations that Peloton pioneered, making the more upscale Peloton less than a viable business in its current form, he said. “I think Peloton was a nice luxury and a fad when it came out, but the bubble has popped.”

Some Peloton customers are taking a more whimsical approach. Rich Davies, the creator behind the YouTube channel “Break It Yourself,” had a simple solution in his latest Peloton review.

He hitched his Peloton bike to an SUV in his driveway, donned a bike helmet and told viewers the answer was to “ride your Peloton to the gym.”

“What I’ve found is that it’s a common criticism of people who don’t own one,” Davies told Forbes. “They say that when Peloton goes under, you’re stuck with a $2,000 coat rack. I would say, most of the comments that are worried about this are from those that aren’t going to buy the bike and just want to hate on it.”

Davies said he’s grown to love his Peloton so much that if his beloved instructors went away, he’d still get on the bike, “put a TV show on and go for 30 minutes.”