This was reported by the Bloomberg news agency over the weekend, citing people familiar with the situation. The “Wall Street Journal” on Friday includes Amazon, the “Financial Times” wrote that Nike is also considering an offer. Peloton Interactive shares jumped 26.42 percent to $31.10 in after-hours NASDAQ trading on Friday, according to reports.
Even so, the paper was still a long way from its former highs. After Peloton’s expensive training bikes became a bestseller in the early days of the corona pandemic, the share was around $150 a year ago and Peloton was temporarily worth more than $50 billion. At the closing price on Friday it was only a good eight billion dollars.
With Peloton, Nike could accelerate the expansion of its business beyond the sale of sporting goods: In addition to bikes and treadmills, the company also offers training subscriptions. In the wellness area, Amazon has so far limited itself to a fitness tracker available in the USA, but device boss Dave Limp is considered in the industry to be a fan of Peloton bikes, who would have liked to have invented them himself.
According to the reports, the considerations of Amazon and Nike are still at an early stage. Both have not yet spoken to Peloton themselves, but only to their advisors, it said, citing informed people. In view of the sharp drop in prices that Peloton has experienced on the stock exchange in recent months, there are also other interested parties. The companies themselves initially did not comment.
The problems at Peloton have recently increased. In November, the New York company had to drastically cut its sales forecast for the fiscal year running until mid-2022 – by up to one billion dollars. One trigger was when Peloton cut the price of the original model of its training bike by a fifth in August. Customers then increasingly preferred it to the more expensive and for Peloton more lucrative new version. Before the price reduction, the two models had sold about equally well, after that the older bike dominated with around 75 percent. At the same time, Peloton is being put under pressure in the market by other manufacturers, some of whom have cheaper competing devices.
A report by the US broadcaster CNBC also caused additional turbulence, according to which Peloton had to pause the production of its bikes and treadmills due to weak demand. Company boss John Foley then denied in a very narrow denial that the production of all models would be suspended. There should be more details on the development of the business when the quarterly figures are presented next Tuesday.
Peloton has also had an unusual image problem in recent weeks: In two TV series, characters suffered heart attacks after Peloton training sessions. The company felt compelled to point out that activity strengthens the heart.
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