Peloton bikes will now be sold on Amazon as company reports billion dollar loss

It looks like more bad news as the once-thriving exercise business continues to fly downhill - and fast.

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The company reported fourth quarter 2022 earnings of a net loss of $1.2 billion (including $415 million to the company attributed to restructuring changes) and a 28% decline in revenue compared to the same period a year earlier, making it the sixth consecutive quarter of profit loss for the company.

Peloton also predicted that it would not break even until the second half of fiscal 2023.

“This loss reflects the substantial progress we have made over the past quarter in reorganizing the business to reduce current and future excess inventory, converting fixed costs to variable costs and resolving numerous issues supply chain," said Barry McCarthy, CEO and President of Peloton. , said in a letter to shareholders. "This progress, along with the reduction in cash burn, is the positive story behind the overall loss."

McCarthy then discussed the layoffs that hit the company earlier this month (approximately 760 employees) and how releasing those employees would open up space to reduce expenses, before announcing that the company will hire Liz Coddington as Peloton's Chief Financial Officer. , formerly of the AWS division of Amazon.

The announcement comes as no shock, as on Wednesday Peloton revealed that it would be partnering with Amazon to start selling its popular bike ($1,445) and Peloton Guide bodybuilding program ($295) and accessories like dumbbells, water bottles and resistance bands through the retailer marking Pleoton's first-ever partnership with a third-party retailer.

Moving away from direct-to-consumer might once have seemed bleak for the recognizable brand, but now feels opportunistic.

So opportunistic, in fact, that Peloton shares soared more than 20% on Wednesday on the news.

“Yesterday we announced that first-generation bikes, guides, select apparel and accessories are on sale on amazon.com in the United States. Amazon has become the number one default shopping destination for hundreds of millions of customers worldwide," McCarthy said. in Thursday's letter to shareholders. "Our Peloton store on amazon.com will bring a selection of our products closer to US Amazon customers and allow us to act directly on the fitness-related shopping queries that occur weekly on Amazon."

Peloton's Bike+ and tread will still only be available through Peloton, direct to consumer.

But after reports of mounting losses on Thursday, the company's shares fell another 20%.

Still, McCarthy remains optimistic about the company's future, despite continued loss forecasts throughout the year and beyond.

"If the past is any prologue, we will continue to evolve our operating model and improve our management of the business, including our approach to managing retail stores, third-party distribution, international , apparel, and corporate health and wellness. But when, over time, we look in the rearview mirror, I think the fourth quarter will have been the culmination of write-offs and restructuring related to inventory and supply chain issues and the beginning of the comeback story for Peloton,” he wrote.

For those who have followed Peloton's downward spiral over the past year, this comes as no surprise: the brand is essentially in freefall thanks to several factors, including massive layoffs and restructuring changes (including the departure of CEO John Foley), rumors of an acquisition by Nike or Amazon, multiple lawsuits for insecure hardware, and the cessation of production of certain weight machines.

"A lot has changed at the Peloton in a relatively short time...