Peloton Interactive (2ON) Q4 2026 Earnings Report

The call communicated meaningful operational and financial progress — notably sustained profitability, higher adjusted EBITDA, stronger margins, substantial free cash flow, reduced leverage, cost-savings achievement, and strong product/AI adoption — while acknowledging near-term top-line and subscription headwinds, a Q4 churn uptick (partly due to a now-corrected payment reactivation issue), a one-time legal contingency, and FY '27 revenue guidance that implies a modest decline. Management emphasized product road map, commercial expansion, and new category launches (calendar 2027/ fiscal '28) as catalysts for future revenue acceleration.

Peloton guided fiscal 2027 to total revenue of $2.3–$2.4 billion (midpoint down ~3.9% YoY, though management says trajectory improves if last year’s subscription price increase is normalized), full‑year total gross margin of roughly 54% (≈+140 bps YoY) and Q1 revenue of $545–$565 million (Q1 midpoint ≈+1% YoY); adjusted EBITDA is guided to $475–$525 million for FY27 (midpoint ≈+7% YoY) with Q1 adjusted EBITDA of $135–$145 million (Q1 midpoint ≈+18% YoY), and minimum free cash flow of at least $350 million for the year; ending paid Connected Fitness subscriptions are guided quarterly (Q1: 2.455–2.475 million, Q1 midpoint ≈‑9.8% YoY), management expects net churn to be roughly flat YoY for FY27 after Q4 net churn of 2.2% (+37 bps YoY), and anticipates record total gross margin, adjusted EBITDA and net income in the company’s history.