Over the past few years, Peloton has repeatedly changed the direction of its business in an effort to return to profitability. The latest decision, announced in its Q4 2025 earnings report, is to focus on health and wellness rather than “just” cardio training.
“Every year, we understand more and more the importance of physical strength, stress management, sleep, and nutrition in order to live our best lives,” said CEO Peter Stern during a conference call. “This creates an opportunity, or rather a necessity, for Peloton to evolve from a cardio training partner to the world’s most trusted wellness partner across the entire spectrum of behavior that maximizes demand for health.”
He went on to explain that the company will focus on “healthy life expectancy,” which is the period of a person’s life during which they are in good health. “Advances in medical science have contributed to an impressive 40-year increase in life expectancy in the US between 1900 and 2020,” Stern said. “However, despite the increase in life expectancy, healthy life expectancy, i.e., the quality rather than the quantity of those years, has not kept pace with this growth. People in the US are living longer, but they are also living with more illness.”
The concept of “health span” is not new. Whoop also recently released a “Health Span” feature in its latest tracker. Peloton’s approach to improving well-being will reportedly involve increased investment in personalized training programs, a separate Strength Plus app, and meditation and sleep features. Stern also noted that Peloton will be testing and refining the addition of nutrition information to its platform. In a letter to shareholders, Stern highlighted the use of artificial intelligence and integration with health tracking devices as a means of providing its members with “increasingly personalized insights, plans, and recommendations.”
From a business perspective, Peloton exceeded investor expectations across the board. The company reported revenue of $607 million, which is approximately $21 million above the upper end of its forecast range. The number of subscriptions to paid fitness programs and paid apps also exceeded targets, reaching 2.8 million and 552,000, respectively. Peloton’s shares rose about 11 percent after the news was released, but Stern noted that the company’s operating costs are still too high.
As a result, according to Stern, the company will undergo another round of cost restructuring, which will include laying off about six percent of its staff. “This decision was not taken lightly, as it affects many talented members of the team, but we believe it is necessary for the long-term health of our business,” Stern wrote in a letter to shareholders. This is the sixth round of layoffs at the company, coming just over a year after the company laid off 15% of its employees and former CEO Barry McCarthy resigned.
Peloton also plans to adjust its prices. This includes a new assembly fee for equipment, which was previously free with purchase. (As before, a free self-assembly option will still be available.) The company also plans to introduce a new special pricing program to make its products more affordable for teachers, military personnel, first responders, and healthcare workers.
