This Pandemic Favourite Stock Surging After Q1 Performance - Is The Poor Run Over?

Peloton Interactive Inc PTON reported a first-quarter FY24 sales decline of 3% year-on-year to $595.5 million, beating the consensus of $591 million. 

The American exercise equipment and media company's EPS loss was $(0.44), missing the consensus loss of $(0.33).

Also Read: Peloton In For A Rough Ride With Increased Churn and Revenue Risks, Analyst Forecasts

The total number of members in the quarter fell 4% Y/Y to 6.4 million. Ending connected fitness subscriptions rose 2% Y/Y to 2.96 million, and Ending App subscriptions fell 13% to 0.76 million.

The average monthly paid app subscription churn was 6.3%. Average Net Monthly Paid Connected Fitness subscription churn of 1.5%.

Gross profit for the quarter increased 31% to $285.4 million, and the margin expanded 1,270 basis points to 47.9%, driven by connected fitness products. 

The operating expenses plunged 29% to $417.6 million.

Adjusted EBITDA for the quarter was $9.1 million versus $(33.4) million last year.

The company held $748.5 million in cash and equivalents.

Outlook: Peloton sees Q2 FY24 revenue of $715 million - $750 million, representing a decline of 2% Y/Y at the midpoint vs. consensus of $763.25 million.

The company expects FY24 revenue of $2.7 billion - $2.8 billion, representing a decline of 8% Y/Y and 23% growth Q/Q at the midpoint vs. consensus of $2.79 billion.

The company expects Q2 ending connected fitness subscriptions of 2.97 million - 2.98 million.

The stock has lost 34.1% YTD.

Price Action: PTON shares are trading higher by 11.90% at $5.38 on the last check Thursday.