Peloton Interactive saw a surge in sales during the pandemic but has faced declining revenue for four consecutive years. The company recently introduced new exercise equipment with AI-powered features in an attempt to attract more customers.

Peloton went public in 2019 at $29 per share and soared by 462% to around $163 during the pandemic. However, sales plummeted post-vaccinations in 2022. The company’s revenue dropped to $2.5 billion in fiscal 2025, prompting a pivot towards AI technology to revive growth.

Peloton’s revenue decline was primarily due to plummeting equipment sales, which fell to $817 million in fiscal 2025 from $3.1 billion in fiscal 2021. The company launched the Cross Training Series with advanced AI systems to tap into new exercise trends like strength training, yoga, and Pilates.

Peloton’s bottom line significantly improved in fiscal 2025 after a $2.8 billion loss in fiscal 2022. Cost-cutting measures led to an adjusted EBITDA of $403 million. The company needs sustainable revenue growth to maintain profitability, making it a risky investment with its current strategy.

Investing in Peloton now comes with risks due to its declining sales and higher-priced new equipment. The company needs to prove it can expand its business sustainably before being a viable investment option. Investors should wait for signs of recovery before considering investing in Peloton.

Read more at Nasdaq: Should You Buy Peloton Stock After Its Shift Into Artificial Intelligence (AI)?