The peloton keeps growing, and so it hurts


Amy Steer begins digging at Peloton Interactive Of ink

PTON -0.38%

The lack of shipping is mainly a way of closing the delivery date on his long delayed bike.

Four months later, Ms. Styer, a 37-year-old former oil industry project manager, has helped organize disgruntled-ho peloton owners, collecting Wall Street’s attention-grabbing delivery delays database.

“They’ve got a great thing, but I don’t appreciate how they are treating their members well,” Ms. Stearn said. Ms. Stear, frustrated by the quality and overall experience with the company, sold her bike after receiving it. He bought another brand.

Since last fall, the peloton has acknowledged logistics problems, keeping in mind the demand for its bike, which starts at $ 1,895 and comes equipped with a screen that shows subscription workout classes. The nine-year-old company has cited growing demand, notably shipping logs at ports, as bike manufacturers move from overseas to the US, and weather disturbances. The pressure from people wanting to exercise at home between Kovid-19 did not increase.

“It is difficult to grow business rapidly during a global pandemic,” said John Foley, Pelton’s chief executive.

The company, which reported financial results on Thursday afternoon, reported at least $ 3.9 billion in sales for the fiscal year ending June 30, double that of the previous fiscal year. Its share price is up 30% in the last three months and has quadrupled compared to a year ago, still driven by the growing legacy of bike owners and investors who would have taken to social media to champion and protect the company Huh.

It is not clear what percentage of orders are affected by the delay. Still, waiting months for peloton bikes and treadmills is a common practice on social media, and the company warns consumers about delays before making a purchase. A common catch, based on social media posts and complaints from the Better Business Bureau: Customers get a delivery date that is weeks or months away, only to have their delivery canceled within the expected arrival hours. Rescheduled dates may be months out.

Another complaint is that customers who finance the peloton pay sometimes for months before they get their bikes.

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“They are taking our money, not delivering a bike and then continuing to sell and deliver new bikes to new customers,” said Laurie Donley, who canceled her order after it was delayed at the last minute Was and the new date was of the month. She broke away from seeing accounts on social media of people receiving bikes in very few windows and explanations given by the company for the delay.

The peloton said that it offers full refunds to anyone who wants to.

A spokesperson for the peloton stated, “Unfortunately, there are many problems related to the port and epidemic beyond our control, which may affect our delivery program, and we are trying our best to deliver new deliveries to customers as quickly Get the dates. “

He added that the company “enables customers in most regions to set a convenient delivery date and time window,” adding to that inventory, as well as delays in delivery issues.

BMO analyst Simeon Siegel said the peloton could exhaust its capacity amid such logistical turmoil. “Prior to Kovid, there were no competitors that were largely funded, now there are more competitors who have raised meaningful amounts of capital,” he said.

Manufacturers in many industries have faced production and distribution problems during the epidemic, and Mr. Siegel said that in a year, consumers are more tolerant of waiting longer for reputable products. “It is one thing to not have units, but to have such a mismatch on delivery is a matter of great disappointment,” he said. “This is a classic sign of a company that has grown faster than its infrastructure.”

Peloton agreed in December to acquire commercial fitness-equipment provider Precor Inc., which would give the company additional US manufacturing capacity.

Problems have given rise to angry customers. Some 10,000 people have joined a Facebook group devoted solely to peloton delays, while the Better Business Bureau has filed more than 1,100 complaints about the company in the past year.

In December, Ms. Stear, of Bellingham, Wash., Began surveying people on a peloton delivery Facebook page and crunching numbers using Google data-aggregation tools in an effort to track down patterns and explain to peloton executives. Serious Problem.

It recently presented its findings to an investor group hosted by a stock analyst who follows the company.

“I started it with despair,” he said. “Now I am doing this to answer my questions.”

Already have a bike? Nicole Nguyen of WSJ shows you the gear and software that you need to turn into a steady cycle connected to the Internet in a few simple steps. Photo illustration by Dom Amtour for The Wall Street Journal; Photo: zwift

write to Sharon terlep at [email protected]

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