Is An 'Epic Comeback' On The Horizon? Why Peloton Stock Is Rising Today

Peloton Interactive Inc PTON shares are trading higher Wednesday after the connected fitness company reported fiscal second-quarter results and issued strong guidance.

What Happened: Peloton reported fiscal second-quarter revenue of $792.7 million, which beat average analyst estimates of $710.45 million, according to Benzinga Pro. The company reported a quarterly net loss of 98 cents per share, which missed estimates for a loss of 64 cents per share.

Peloton subscription revenue totaled $411.3 million, up from $337.5 million year-over-year. Subscriptions outpaced hardware sales despite it being a seasonally strong period for hardware.

The company ended the quarter with 3.03 million connected fitness subscriptions, representing 10% growth year-over-year.

"Nine months ago we reported FCF of $(747) million. This quarter we reported FCF of $(94) million. But strip out the costs of paying suppliers to settle obligations for parts we don't need, and we generated positive FCF of approximately $8 million in Q2. If you’ve been wondering whether or not Peloton can make an epic comeback, this quarter's results show the changes we’re making are working," CEO Barry McCarthy said in a letter to shareholders.

Peloton expects fiscal third-quarter revenue to be between $690 million and $715 million versus estimates of $692.14 million. The company expects third-quarter gross margins to come in around 39%.

Peloton noted that it expects near-term demand for connected fitness hardware products to remain challenged.

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PTON Price Action: Peloton has a 52-week high of $40.35 and a 52-week low of $6.66.

The stock was up 4.41% at $13.50 at the time of writing, according to Benzinga Pro.

Photo: courtesy of Peloton.