Peloton loses almost £100m as UK arm sheds hundreds of jobs

The UK arm of Peloton lost almost £100m and shed hundreds of jobs, it has been revealed.

The London-headquartered division has posted a pre-tax loss of £98.1m for the 12 months to June 30, 2023, according to newly-filed accounts with Companies House.

Peloton previously posted a pre-tax loss of £173.7m for its prior financial year.

The results, which are almost five months late, also show its revenue was cut from £127.7m to £93.8m over the same period.

During the year the average number of people employed by Peloton’s UK arm was cut from 682 to 441.

Peloton’s UK results for its most recent financial year, the 12 months to June 30, 2024, are due to be filed with Companies House by March 31, 2025.

Hardware sales cut almost in half

A statement signed off by the board said: “In FY23 subscription revenue contributed over half of the company’s turnover at £55.7m, this was an increase of 16 per cent over the prior year, as we continue to add members and experience low churn rates.

“Hardware revenue for FY23 was £36.5m which was a decrease of 47 per cent on the prior year.

“This decrease is largely attributed to reduced marketing spend – there was a focus in FY23 to drive more efficient customer acquisition costs and reduce our operating expenses, this meant that marketing spend was materially reduced.”

Peloton added that its operating loss “significantly reduced” in the year by £75.6m or 43 per cent.

The company said that its cost of sales decreased by 35 per cent and administrative expenses fell by 37 per cent.

Peloton said the hardware portion of the cost of sales was cut in line with the fall in sales of connected fitness units.

The decrease in administrative costs was driven reduced marketing spend and a fall in employee costs.

During the year Peloton recorded £17.1m in restructuring costs, down from £36.6m in the prior year.

Peloton’s parent company cuts loss as revenue slides

For the same financial year, the US-headquartered Peloton group posted a revenue of $1.1bn, down from $2.1bn while its pre-tax loss went from $2.8bn to $1.2bn.

For the six months to the end of December 2023, Peloton reported a revenue of $1.3bn, down from $1.4bn.

Its pre-tax loss was also cut from $741.2m to $355.1m.

Peloton has also posted a third quarter revenue of $717.7m for the three months to the end of March 2024, down from $748.9m.

Its pre-tax loss was also cut from $275.2m to $166.7m.

Peloton’s UK results come after static bike brand Wattbike said it anticipates making “further losses” as a slump in turnover resulted in a “disappointing” year for the company.

The Nottingham-headquartered group, which supplies training bikes for organisations including The British Army, Manchester United and David Lloyd gyms, saw its turnover fall to £13.6m in the 12 months ended September 30, 2023, down from £20.4m in the year before, according to recently-filed accounts.

Wattbike said the reduction in sales had been caused by suppressed customer demand following a surge in interest during the Covid-19 pandemic.

But despite this dip in turnover, Wattbike managed to cut its pre-tax loss to £6.8m during its financial year, down from £8.7m in the 12 months before.