The Backstory
Peloton has released its 2026 earnings report, and the results are…interesting. Technically, for the first time in the company’s history, they’ve had an actually profitable year. Honestly, I wasn’t sure post-pandemic we’d see the company ever again.
I think most people know Peloton from the COVID-era. There was a very motivated brand of person that panic-bought a Peloton because it was finally time to focus on their health. Ultimately, the stationary bike became a very expensive coat rack, and killed that one guy on Sex and the City, so the brand decline was quite obvious as COVID started to “wind down.”
But none of this explains why there was a sudden jolt of profits in 2026. The earnings report does show that subscriptions grew and equipment revenue fell. That tells me people who have lapsed using their Pelotons circled back, which is a genuinely interesting trend (if that’s what’s happening).
When you think about it, Peloton is ultimately a delivery vehicle (lol) for workout videos. People sign up for the subscription service, and it creates recurring revenue for the brand, and the audience gets a better, funner workout. Even when Peloton stock was really collapsing at the end of COVID, their subscription levels have always remained pretty stable.
One of the biggest mistakes Peloton made was investing in more bikes when they were seeing their huge surge in sales in 2020. They created a huge volume of equipment, and it started rolling out to consumers right when the vaccine was becoming available. That was a timing problem, and I think any founder that was seeing a huge swell in sales would answer that by working to create more volume of their product.
What to Watch
Now, back in 2026, Peloton is fully leaning into subscriptions and their instructors and further building their content catalog.
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But what do they do next? Should Peloton run as a content company and keep spending on content until people (hopefully) start buying? I think if they keep focused on subscriptions, keep making good content, and continue to see declines in equipment sales, then we know for sure the fad of Peloton has officially passed. Maybe when you’re not sheltering in place, it is nice to ride an actual bike outside in real life. Whatever.
If you’re new here, I write a monthly serialized novel called Everything is Advertising, about a burned-out Creative Director and his cynical team that accidentally create QAnon through a viral marketing campaign. If you like that kind of thing, you can start at Part One and catch up from there.
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