Peloton Just Posted Its First Full Year of Profits. Here's Why I'm Still Not Buying the Stock.
Cost savings boosted net income and free cash flow, but revenue remained flat last quarter.
Peloton Interactive reported its first profitable year in fiscal 2026, with net income of $63 million, despite posting a flat Q4 revenue of $608 million. The company's stock fell after earnings, with management only projecting 1% year-over-year growth for fiscal 2027. Subscriber losses were evident, with a 9% decline in the number of subscribers.
While Peloton's commercial business and user engagement showed positive trends, the company is still facing headwinds in revenue growth and subscriber base. The competitive market and the need to win new customers pose challenges. Peloton has potential for growth, but the stock's valuation and lack of evidence of subscriber growth improvements make it unsuitable for purchase at this time.
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