At $4.9bn, Peloton’s market cap value has plunged to just 10% of what it was in January 2021
MBW’s Stat Of The Week is a series in which we highlight a single data point that deserves the attention of the global music industry. Stats for the week powered by Music group Cinqa technology-based rights management, distribution and record label company.
It’s not a secret Spotifythe market capitalization of was suffering of late.
Within 15 months of peaking 69.35 billion USD On February 19, 2021, the market capitalization of SPOT has decreased by more than 50 billion dollars.
But Spotify isn’t the only music-related giant of the tech world to see its market cap plunge over the past year.
Let’s look at Peloton.
The connected fitness company – one of the big winners of the lockdown as gyms and live fitness classes were forced to close – has announced its third quarter 2022 financial results (Q1 Calendar). this week, it was revealed that its total sales were 964.3 million dollars has decreased by 24% YoY compared to 1.26 billion dollars in the same quarter of last year.
Peloton Q1 Calendar Connected Fitness Product Sales 594.4 dollars. million fell 42% YoY, compared to 1.02 billion dollars was created during the same three months ending March 2021 (see below).
The company also reported a net loss 757 million dollars for three months to the end of March.
Peloton said that the main reason for the year-over-year decline in sales was “a decrease in consumer demand after the peak of the pandemic”.
In other words, people don’t need – and don’t want – to stay at home anymore, and Peloton, whose business revolves around exercising at home, is seeing its revenue dwindle.
Peloton’s financial crisis is further accentuated by the fact that its market capitalization, which has peaked 49.27 billion USD in January 2021, today (May 13) stands at 4.94 billion USD at the time of publication, closed on 4.16 billion dollars two days ago (May 11).
Peloton’s market capitalization has therefore fallen by about $45 billion since January last year. Today that market capitalization is only worth ten% the company’s peak value 17 months ago.
True: Peloton’s market capitalization has fallen more than 90% in the past year and a half.
Writing to investors this week, the company’s CEO – former Spotify CFO Barry McCarthyWho take over from co-founder John Foley in February – opened his letter with the following statement: “Turning around is hard work.”
McCarthy took over at Foley around the same time Peloton announced a ‘comprehensive restructuring program’, amid a post-closed sales slump.
New Peloton CEO who masterminded Spotify disrupting traditional IPOs in 2018, in his letter added that the Wheel was “intellectual testing, mentally draining, physically exhausting and all-consuming”.
“The turning points are intellectually challenging, mentally draining, physically exhausting and all-consuming.”
Barry McCarthy
He continued: “It is a purely contact sport. That’s why I want to start this Shareholder Letter with a heartfelt thank you and to the Peloton employees who are working hard to make this company a success. ”
McCarthy’s letter to investors comes just three months after Peloton cut 20% of its global workforce, or 2,800 jobs, as part of a restructuring program.
Elsewhere in the letter, McCarthy writes that his goal was to make Peloton a globally connected fitness platform with 100 million members, despite the fact that it ended in March of 2022 with only 7 million members on its books.
McCarthy said of his 100 million goal: “That equates to about half of the global gym membership in the world. It’s been a long, long way from where we sit today. But we are at the heart of fitness-assisted technology, a long-term growth trend of the secular.
“Who doesn’t want to live a healthier, happier, longer life? We will share more about how we plan to participate in that growth in the coming months and years. ”
“[Peloton is] thin cap for a business of our size. ”
Barry McCarthy, speaking on Tuesday
But does Peloton have a long, happy, healthy life ahead?
McCarthy has cut his job: On Tuesday (May 10), moderator admitted to investors that Peloton, carrying those heavy losses, was “very little capitalized for a business of our size.”
Peloton had 879 million dollars in cash remaining on the balance sheet at the end of March.
Peloton’s dwindling fortunes amid the post-pandemic business landscape comes just two years after the digital fitness industry began proving to be a major financial driver for music rights holders.
Peloton in particular has been very active in pursuing deals and relationships in the music industry, outstanding partnerships with Queen, Taylor Swiftthe David Bowie EstateBeyoncé and more.
The company even internal DJ recruitmentJohn Michael and DJ Skribble, who recently remixed tracks for Demi Lovato and Debbie Gibson to optimize them for users’ workouts.
To put the value of the fitness industry’s contribution to the music business over the past two years into context, roughly a year ago, Sony Music Group Boss, Rob Stringernote that his company’s record music business has generated nearly 400 million dollars from social, game and fitness platforms in its previous fiscal year.
Cinq Music Group’s performances have won Grammy Awards, dozens of RIAA Gold and Platinum certifications, and many No.1 positions on many Billboard charts. Its repertoire includes such heavyweights as Bad Bunny, Janet Jackson, Daddy Yankee, TI, Sean Kingston, Anuel, and hundreds more.
Worldwide music business
