From Yahoo Finance: 2025-05-27 13:37:00

Citi analyst Ronald Josey cut Peloton Interactive, Inc.’s (NASDAQ:PTON) price target to $8.50 from $10, maintaining a Neutral rating due to mixed Q3 fiscal results. Sales fell 13.1% year-over-year to $624 million but beat estimates. The company’s adjusted earnings were $89.4 million, exceeding expectations of $80.37 million.

Peloton raised revenue guidance to $2.46 billion for the year, expecting higher subscription revenue. Despite EBITDA of $340 million falling below estimates, the company anticipates an improved free cash flow margin. Citi is optimistic about Peloton’s prospects, with plans for growth acceleration and cost reduction under new leadership.

Peloton is focusing on cost-effective member acquisition, with advertising and marketing spending down 46% in Q3. Ending Paid Connected Fitness Subscriptions for FY25 are expected to range between 2.77 and 2.79 million, showing growth potential. The company offers various connected fitness products like Peloton Bike and Tread through e-commerce and retail showrooms.

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Read more: Citi Cuts Peloton (PTON) Price Target, Reiterates Neutral Rating