Blog Post 1.3 "Peloton vs the Gym"

The pandemic made many fitness-minded companies very wealthy, but few benfited more than Peloton. But over a month ago, their company's shares lost more than a third of their value after dimishing sales. This led to Peloton slashing nearly $1 billion off its revenue projections. Hordes of Americans setting aside their home-based workout routines and heading back to the gym caused this decline.


1. How much revenue is Peloton expecting to lose this year? What has happened to their stock price as a result?

$1 billion. The stock slumped 35.4%, to $55.64.


2. When sales of Peloton bikes first started to decrease, how did the producer respond to try to increase purchases?

Companywide hiring freeze. Cut 20% off the price of its signature bike.


3. How do sales of home fitness equipment in 2021 compare to 2019 sales? What's the main reason for this increase?

Home fitness equipment sales in 2021 are 100% more than 2019, because people were in a global pandemic. 


4. Let's predict how demand works: If the demand for gym memberships increases, what do you think happens to the demand for Peloton bikes? WHY?

Decrease, because less people will need them, which will lead to less people buying them.


5. If the prices of subscriptions to Peloton classes goes up, what do you think happens to the demand for Peloton bikes? WHY?

Increase, because people who ride Peloton bikes frequently will save more money by just owning their own instead of paying monthly to use one.


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