Peloton Interactive Clocks 29% Sequential Revenue Growth In Q2; Top-Line Exceeds Expectations

Peloton Interactive Inc PTON reported a second-quarter FY23 sales decline of 30.1% year-on-year to $792.7 million but topped the consensus of $710.45 million. Revenue improved 29% Q/Q.
The total number of members in the quarter fell 1% Y/Y to 6.7 million.
Ending connected fitness subscriptions rose 10% Y/Y to 3.03 million, and Ending App subscriptions slipped 1% to 0.852 million.
Average net monthly connected fitness churn was 1.1% versus 0.8% a year ago.
Gross profit for the quarter fell 16% to $235 million. Total operating expenses declined 20% to $566.4 million.
Adjusted EBITDA loss for the quarter was $(122.4) million.
The company held $871 million in cash and equivalents as of Dec. 31, 2022.
EPS loss was $(0.98), missing the analyst consensus of $(0.64).
Outlook: Peloton sees Q3 FY23 revenue of $690 million - $715 million, against the consensus of $692.14 million.
The company expects Q3 gross margin of about 39% and Q3 ending connected fitness subscriptions of 3.08 million – 3.09 million.
Price Action: PTON shares are trading higher by 18.33% at $15.30 on the last check Wednesday.

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