New York City, USA: Private equity firms are eyeing a potential buyout of Peloton, the connected fitness company based in New York, as it seeks to restructure its debt and bounce back from 13 consecutive quarters of losses, as reported by CNBC on Tuesday. Speculation surrounding the company’s future has caused shares of the fitness equipment manufacturer to surge by 13% in early trading.
Amidst talks of going private, Peloton has engaged in discussions with at least one private equity firm in recent months, according to sources familiar with the matter. However, a Peloton spokesperson declined to comment on the rumors or speculations circulating in the media.
Last week, Peloton faced significant changes as CEO Barry McCarthy resigned while the company announced a series of job cuts to curb costs following disappointing financial results. Decreased demand for its stationary bikes and treadmills, even after implementing price reductions, contributed to Peloton reporting lower-than-expected revenue for the third quarter and revising its full-year forecast.
Reports indicate that a number of private equity firms have expressed interest in acquiring Peloton, though the extent of formal discussions remains uncertain at this point. The company’s efforts to navigate financial challenges and potential buyout opportunities suggest a significant shift in its future direction.
Overall, Peloton’s recent struggles and the potential for a buyout reflect a pivotal moment for the company as it seeks to revamp its operations and drive growth in the increasingly competitive fitness industry. The coming weeks may shed more light on the path Peloton chooses to take as it works towards achieving financial stability and sustained success.