Peloton Interactive (PTON) AI Stock Analysis

• Market Cap: $3.19B
• Dividend Yield: N/A
• Average Volume (3M): 14.02M
• Price to Earnings (P/E): ―
• Beta (1Y): 2.33
• Revenue Growth: -7.76%
• EPS Growth: 79.66%
• Country: US
• Employees: 2,853
• Sector: Consumer Cyclical
• Sector Strength: 84
• Industry: Leisure
• EPS (TTM): 0.05
• Shares Outstanding: 391,926,270
• 10 Day Avg. Volume: 10,451,264
• 30 Day Avg. Volume: 14,023,675
• PEG Ratio: 0.28
• Price to Book (P/B): -6.54
• Price to Sales (P/S): 1.09
• P/FCF Ratio: 8.36
• Enterprise Value/Market Cap: 1.18
• Enterprise Value/Revenue: 1.51
• Enterprise Value/Gross Profit: 2.96
• Enterprise Value/Ebitda: 34.57
• 1Y Price Target: $10.46
• Price Target Upside: 33.76% Upside
• Rating Consensus: Moderate Buy
• Number of Analyst Covering: 13

• Rating: 49 Neutral
• Price Target: $7.50 ▼(-4.09% Downside)

Peloton's overall stock score is primarily impacted by its financial challenges, including declining revenues and high leverage. While the earnings call provided a positive outlook with strategic innovations and debt reduction, the valuation remains unattractive due to ongoing losses. Technical indicators are neutral, offering no strong momentum signals.

Positive Factors

Debt Reduction

Significant debt reduction strengthens Peloton's financial stability, improving its balance sheet and reducing financial risk, which supports long-term growth.

Gross Margin Improvement

Improved gross margins indicate better cost management and pricing strategies, enhancing profitability potential and competitive positioning over time.

Innovations and Market Strategies

Innovative strategies and market expansion efforts can drive future growth by reaching new customer segments and enhancing brand value.

Negative Factors

Revenue Decline

Declining revenue and subscriptions signal challenges in maintaining customer engagement and market share, potentially impacting long-term growth.

Financial Instability

Negative equity and high leverage highlight financial instability, limiting Peloton's ability to invest in growth and weather economic downturns.

Tariff and Cost Headwinds

Tariff exposure and restructuring indicate cost pressures, which could erode margins and require strategic adjustments to sustain profitability.

Peloton Interactive Business Overview & Revenue Model

Company Description

Peloton Interactive, Inc. is a leading fitness technology company that specializes in providing high-quality exercise equipment and digital fitness content. Founded in 2012, Peloton has revolutionized the way people engage in fitness by combining hardware, software, and community. The company's core products include its stationary bicycles and treadmills, which feature interactive touchscreens for streaming live and on-demand classes. In addition to its equipment, Peloton offers a subscription-based service that provides access to a wide variety of fitness classes, including cycling, running, strength training, and yoga, fostering a strong community among users.

How the Company Makes Money

Peloton generates revenue primarily through two key streams: the sale of fitness equipment and subscription services. The company's hardware offerings, including its Peloton Bike, Bike+, and Tread, contribute significantly to its revenue when sold directly to consumers. Once customers purchase the equipment, they are encouraged to subscribe to Peloton's All-Access Membership, which provides access to its vast library of live and on-demand fitness classes. This subscription model is a recurring revenue stream that has proven to be highly valuable, as it fosters customer loyalty and promotes long-term engagement. Additionally, Peloton has formed strategic partnerships with various fitness and wellness brands, enhancing its market presence and potentially opening new revenue avenues. The combination of hardware sales and subscription services positions Peloton as a formidable player in the fitness industry.

Peloton Interactive Financial Statement Overview

Summary

Peloton faces significant financial challenges with declining revenues, persistent losses, and a highly leveraged balance sheet. Improvements in cash flow generation are noted, but profitability and leverage issues remain critical concerns.

Income Statement

Peloton's income statement reveals declining revenue growth and negative profit margins. The gross profit margin has improved slightly in the latest year, indicating some cost control, but the net profit margin remains negative, reflecting ongoing losses. The EBIT and EBITDA margins have shown some improvement but remain negative, indicating operational challenges.

Balance Sheet

The balance sheet shows a concerning negative stockholders' equity, leading to a negative debt-to-equity ratio, which indicates financial instability. The return on equity is also negative, reflecting the company's inability to generate profits from its equity base. The equity ratio is low, suggesting high leverage and potential financial risk.

Cash Flow

Peloton's cash flow statement shows positive free cash flow growth, indicating some improvement in cash generation. However, the operating cash flow to net income ratio is low, suggesting that cash generation from operations is weak relative to net income. The free cash flow to net income ratio is close to 1, indicating that most of the net income is being converted into free cash flow.

Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	2.49B	2.49B	2.70B	2.80B	3.58B	4.02B
Gross Profit	1.27B	1.27B	1.21B	923.60M	698.40M	1.45B
EBITDA	108.70M	-36.20M	-330.80M	-1.04B	-2.53B	-119.60M
Net Income	-119.00M	-118.90M	-551.90M	-1.26B	-2.82B	-189.00M
Balance Sheet
Total Assets	2.13B	2.13B	2.19B	2.77B	4.04B	4.49B
Cash, Cash Equivalents and Short-Term Investments	54.50M	1.04B	697.60M	813.90M	1.25B	1.61B
Total Debt	1.98B	1.98B	2.08B	2.36B	2.37B	1.51B
Total Liabilities	2.54B	2.54B	2.70B	3.06B	3.44B	2.73B
Stockholders Equity	-413.70M	-413.70M	-519.10M	-295.20M	603.70M	1.75B
Cash Flow
Free Cash Flow	323.70M	323.70M	-85.80M	-470.00M	-2.36B	-491.90M
Operating Cash Flow	333.00M	333.00M	-66.10M	-387.60M	-2.04B	-239.70M
Investing Cash Flow	-5.10M	-5.10M	26.80M	-69.90M	171.00M	-585.10M
Financing Cash Flow	1.70M	1.70M	-94.40M	76.80M	2.02B	916.80M

Peloton Interactive Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 7.82
• 50DMA: Negative
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Neutral
• STOCH: Neutral

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For PTON, the sentiment is Positive. The current price of 7.82 is above the 20-day moving average (MA) of 7.81, below the 50-day MA of 7.89, and above the 200-day MA of 7.26, indicating a neutral trend. The MACD of -0.08 indicates Negative momentum. The RSI at 48.91 is Neutral, neither overbought nor oversold. The STOCH value of 50.86 is Neutral, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for PTON.

Peloton Interactive Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
OSW	70 Outperform	$2.18B	31.30	13.16%	0.75%	8.51%	31.24%
Sector *	61 Neutral	$18.38B	12.79	-2.54%	3.03%	1.52%	-15.83%
PLNT	55 Neutral	$8.29B	42.99	―	―	12.47%	22.74%
MODG	51 Neutral	$1.85B	―	-46.53%	―	-2.35%	-7104.57%
LUCK	50 Neutral	$1.17B	―	―	2.63%	4.05%	77.32%
PTON	49 Neutral	$3.19B	―	―	―	-7.76%	79.66%
XPOF	42 Neutral	$339.82M	―	―	―	-3.02%	-517.53%

Peloton Interactive Corporate Events

Peloton Updates Executive Compensation Program

On September 14, 2025, Peloton Interactive‘s Compensation Committee approved a redesign of the company’s executive compensation program to better align with market practices and its pay-for-performance philosophy. The changes include a new mix of cash compensation and a transition to a combination of time-based and performance-based restricted stock units for long-term incentives. Additionally, stock ownership guidelines were adopted to ensure executives maintain a minimum level of company stock ownership, reflecting a commitment to aligning leadership interests with those of shareholders.

The most recent analyst rating on (PTON) stock is a Hold with a $8.50 price target. To see the full list of analyst forecasts on Peloton Interactive stock, see the PTON Stock Forecast page.

Peloton’s AI Gamble: Navigating Risks and Challenges in a Competitive Market

Peloton Interactive’s increasing reliance on artificial intelligence and machine learning technologies introduces a spectrum of risks that could potentially harm its reputation, competitive standing, and operational results. The integration of these complex and rapidly evolving technologies demands significant investment and skilled personnel, with no guarantee of achieving the anticipated benefits. Additionally, the uncertain legal and regulatory landscape surrounding AI, coupled with potential ethical issues and cybersecurity risks, could lead to legal liabilities and brand damage. Competitors may also outpace Peloton in AI adoption, further challenging its market position and financial performance.

Peloton Interactive Reports Strong FY2025 Performance

Peloton Interactive is a company specializing in connected fitness products and services, offering premium hardware, intuitive software, and engaging fitness content, primarily in the health and wellness sector.

Peloton’s Earnings Call: Financial Gains Amid Challenges

Peloton Interactive’s recent earnings call painted a picture of both optimism and caution. The company reported strong financial improvements, particularly in free cash flow and debt reduction, alongside strategic innovations and leadership enhancements. However, these positive developments were tempered by declines in subscriptions and revenue, as well as ongoing restructuring and tariff challenges.