Peloton Interactive Inc.’s stationary bikes are on display in the company’s Madison Avenue showroom in New York, the United States, Wednesday, December 18, 2019.
Jeenah Moon | Bloomberg | Getty Images
Peloton is looking beyond the house for its next stage of growth.
The company announced Monday that it has created a unique platform from which hospitality industry customers can purchase both its connected fitness equipment and Precor products online. After capitalizing on consumer demand forced indoors by the coronavirus pandemic, Peloton aims to capitalize on a reopening economy.
The move comes after Peloton finalized its $ 420 million acquisition of Precor in April. The deal not only gave Peloton manufacturing capability in the United States, but also a host of treadmills, cycles, ellipticals, rowers, and other strength training equipment often found in commercial environments such as health clubs, universities and hotels.
“It really is a B2B game for us,” said Brad Olson, Peloton Commercial Director. “We’ve been selling Peloton bikes in hotels and resorts for years.… But that’s really the highlight and one of the main pieces of the rationale for the deal we bought Precor for.”
Peloton will also work with hotel partners to provide in-room exercise bikes upon request.
“We know that [having] our bikes in hotels and resorts around the world present a great opportunity for lead generation to promote Peloton product and content, ”said Olson.
Peloton does not break down sales to individuals against its business activities. But the company has acknowledged that most of its revenue comes from people who buy fitness equipment for their home gyms.
Peloton signaled earlier this year that it is keen to expand its membership base through business partners as more people have started leaving home during the pandemic. Peloton has launched a corporate wellness program, which offers benefits to companies that partner with the company and choose to outfit their office gyms with Peloton equipment.
Peloton also recently lowered the price of its exercise cycle in an effort to reach new users. The company has hinted that it is working on additional fitness products that will debut in the future.
The move to boost its business operations comes after the company reported a larger-than-expected loss in its fiscal fourth quarter. The costs associated with a treadmill recall have reduced sales. As it recovers its investments in marketing, Peloton has said it does not expect to return to profitability until fiscal 2023.
Peloton shares are down about 32% this year. The company has a market value of approximately $ 31 billion.