Peloton Interactive, Inc. (PTON) Earnings
Peloton Interactive, Inc. is expected to report next earnings on August 6, 2026 (in NaN days), with a consensus EPS estimate of $0.11. PTON has beaten EPS estimates in 5 of its last 12 reported quarters (average surprise +78.6% over the last four).
| Report date | EPS est | EPS actual | Surprise | Revenue | Rev. surprise |
|---|---|---|---|---|---|
| May 7, 2026 | $0.07 | $0.05 | -28.6% | $631M | +2.0% |
| Feb 5, 2026 | $-0.07 | $-0.09 | -28.6% | $657M | +5.9% |
| Nov 6, 2025 | $0.01 | $0.03 | +200.0% | $551M | +1.8% |
| Aug 7, 2025 | $-0.07 | $0.05 | +171.4% | $607M | +10.5% |
| May 8, 2025 | $-0.06 | $-0.12 | -100.0% | $624M | +7.7% |
| Feb 6, 2025 | $-0.19 | $-0.24 | -26.3% | $674M | +3.2% |
| Oct 31, 2024 | $-0.16 | $-0.00 | +98.5% | $586M | +1.9% |
| Aug 22, 2024 | $-0.18 | $-0.08 | +55.6% | $644M | +2.1% |
| May 2, 2024 | $-0.39 | $-0.45 | -15.4% | $718M | +13.6% |
| Feb 1, 2024 | $-0.55 | $-0.54 | +1.8% | $744M | +1.4% |
| Nov 2, 2023 | $-0.36 | $-0.44 | -22.2% | $596M | +0.8% |
| Aug 23, 2023 | $-0.45 | $-0.68 | -51.1% | $642M | +0.3% |
Source: company filings + earnings calendar. For informational purposes only — not investment advice.
Earnings call summary
Q3 FY2026 · May 7, 2026
AI summary of management’s prepared remarks and analyst Q&A. For informational purposes only — not investment advice.
Management highlights
- Strategy of evolving from connected fitness to connected wellness: Four pillars - improve member outcomes, meet members everywhere, make members for life, business excellence. - Improving member outcomes: Over 400,000 took High Lit classes with Rebecca Kennedy, Pilates modality grew 48%, launched 140 Peloton instructor-led meditation and sleep classes in Breathwork app, Sarah Robb O'Hagan joined as Chief Content and Member Development Officer. - Meeting members everywhere: Content licensing partnership with Spotify bringing over 1400 Peloton classes to Spotify Premium subscribers globally, commercial business unit had 14% revenue growth in Q3, announced Peloton Commercial Series with new bike and treadmill for gyms. - Members for life: Initiatives like Club Peloton, personalized plans from Peloton IQ, reactivation offers led to net churn seven basis points lower year over year in Q3 despite price change. - Business excellence: Achieved positive year-over-year revenue growth in Q3, growth in gross margin, adjusted EBITDA, free cash flow. Right-sized cost structure, aim to achieve at least $100 million of run rate cost savings by end of fiscal 2026. Strong balance sheet with 70% reduction in net debt year over year.
Guidance
- Full year fiscal 2026 total revenue outlook $2.42 to $2.44 billion, increase of $10 million at midpoint compared to prior guidance, 2% revenue decrease year over year at midpoint. - Full year fiscal 2026 total gross margin guidance roughly 52.5%, decrease of roughly 50 basis points relative to prior guidance, improvement of 160 basis points year-over-year. - Full-year fiscal 2026 guidance range for adjusted EBITDA $470 million to $480 million, in line with prior guidance, 18% year-over-year increase at midpoint. - Q4 guidance range for ending paid connected fitness subscriptions 2.55 to 2.57 million. - Expect average net monthly paid connected fitness subscription churn rate to be roughly flat year over year in full year fiscal 2026 despite price change, gross additions expected to decrease year-over-year due to lower equipment sales. - Expect full-year fiscal 2026 free cash flow to be in the vicinity of $350 million.
Segment performance
Total revenue in Q3 was $631 million, exceeding guidance by $6 million. Total gross profit was $327 million, an increase of $9 million or 3% year-over-year. Total gross margin was 51.9%, an increase of 90 basis points year-over-year. Connected fitness equipment sales across Peloton and Precor brands contributed to the revenue. Q3 average net monthly paid connected fitness subscription churn was 1.2% and improved seven basis points year over year. Ending paid connected fitness subscriptions in Q3 were 2.662 million in line with the midpoint of guidance range. Commercial business unit revenue increased 14% year over year in Q3.
Analyst Q&A
Q: Can you clear up some of the confusion around Section 232 tariffs? Are your products exempt? And what is the new view on tariff impact for the year? Do we expect a refund on previously paid IEPA tariffs?
A: Tariffs are a moving target. Equipment manufactured in US not subject to tariffs. Imported Peloton and pre-core hardware no longer subject to Section 232 tariffs on aluminum and steel but remain subject to other tariffs. Closely monitoring IEPA refund requests, expect tariffs to represent roughly $30 million of free cash flow exposure for full year 26, a reduction of $15 million relative to previous estimate. -
Q: Provide an update on the company's capital allocation plan now that the balance sheet has been significantly improved thanks to several quarters of positive free cash flow. Can shareholders expect the share repurchase plan to be announced soon?
A: $1 billion term loan has $10 million prepayment penalty expiring at end of month. Approaching zero net debt, working with banking partners on plan. Four-part framework: reduce cost of capital, increase flexibility, reduce dilution, ensure capital for sustainable operation and investment. Will have more to share after CFO search concludes. -
Q: TURN has surprised to the upside for more than three, four consecutive quarters for Peloton here. Do you see churn trends stabilizing enough for you to then think about the delta between subscribers that are churning annually versus growth ads and how you look to close that gap over time?
A: Q3 churn results are good. Gross ads decline rate is decelerating. Net churn rates are improving. Goal is to accelerate convergence of gross ads and subscriber churn while being sustainable and profitable. Revenue growth vectors include selling additional equipment to existing members, commercial business unit revenue, Spotify deal, pricing changes, promotional levers. -
Q: Talk a little bit about the promotional intensity you saw in q3 i think you called that out as one of the drivers of gross margin um and try to reconcile basically your q4 guide for connected fitness subscribers with your comments around churn being relatively flat. Also, preview of new hardware coming in this fall.
A: Used LTV to CAC framework. Extended a promotion and took deeper price promotion on equipment in Q3, still had LTV to CAC at 2x. No plans to repeat in Q4. Seasonality affects Q4. Can't comment specifically on unannounced hardware today, but bringing price accessibility in existing modalities and broadening equipment portfolio in strength category are priorities. -
Q: Elaborate more on the demand pipeline and how the product and go-to-market strategy is changing, especially as you launch the new products in 2Q27. And talk about some channels where you're seeing some of this efficiency and spend that allowed you to get those deeper promos throughout the quarter.
A: Commercial business unit grew 14% in Q3. Look ahead, CBU revenue growth softer in Q4 due to elevated revenue last year. Long-term growth potential with 3% market share. Growth vectors: growing legacy pre-core business, investing in commercial product roadmap (Peloton Commercial Series launching in 2Q27), international expansion. Channels: good efficiency on web email marketing, encouraging results from microstores, good customer acquisition from secondhand sales, relatively less productive third-party retail and fitness-as-a-service rental business. -
Q: How long for real inflection as a result of wellness efforts. How critical is balance sheet rework in driving next leg of growth.
A: Revenue to come ahead of subscriptions. Steps forward in cardio, strength, mental well-being, nutrition, hydration. Members engaging in multiple modalities helps. Balance sheet rework not needed to drive strategy, but refinancing would be beneficial for reducing interest, increasing flexibility, enabling shareholder-friendly actions like buybacks, and considering investments/acquisitions. -
Q: How you think about the evolution of the business across commercial business unit, partnerships like Spotify, and hardware sales, and the key metric of net ads.
A: Quality revenue matters. Subscriptions are important but revenue is key. Commercial business growth sustainable, content licensing leverages existing content for additional revenue. Peloton brand underexploited in commercial space. Hardware sales in gyms come with some subscribers but not at same ratio as households. Evolution from connected fitness to connected wellness across multiple categories with high-quality revenue.