Peloton rollercoaster continues with reports of takeover interest

Indoor cycling and running equipment giant Peloton is rumoured to be drawing interest from Nike and Amazon, whispers of which today saw a stock rise of 27% during early premarket trading in New York.

The business, which, at its 2021 lockdown-driven peak recorded revenues in excess of $1 billion in a single quarter, then saw $8 Billion wiped from it’s market value in November of the same year.

Drivers behind the financial rollercoaster include manufacturing challenges, underwhelming sales of the newly launched treadmill lines, then compounded further by a product recall, and, as lockdown eased, a widespread return to public gyms, collectively resulting in serious questions being raised about the financial performance of the business. The company experiences a relatively high rate of short selling on its stock, which in simple terms means investors betting against the company’s share price.

Chief financial officer Jill Woodworth told investors: “It is clear that we underestimated the reopening impact on our company and the overall industry.”

Amongst this volatility Peloton began working with advisors, sparking rumour that a buyer was being sought. As speculation about suitors increases, further trading is reported likely, with investor seeking to maximise the opportunity.

The Financial Times reports that neither Nike nor Amazon have held direct talks with Peloton.