![Once a pandemic darling, Peloton shares tumble with demand](https://globalnews.ca/wp-content/uploads/2022/05/20220510080540-627a5d693c9fbbc365a70898jpeg.jpg?quality=85&strip=all&w=720&h=379&crop=1)
Once a pandemic darling, Peloton shares tumble with demand
Global News
Like many stay-at-home winners, the fitness equipment maker is grappling with plummeting demand.
Peloton Interactive Inc reported a bigger third-quarter net loss on Tuesday as expenses doubled and demand for its fitness equipment cratered from pandemic highs, leading to warn the company was “thinly” capitalized.
The company’s shares tumbled about 25 per cent to $10.6 in trading before the bell and were set for a record low opening, if current losses hold.
“The balance sheet challenge has been managing inventory,” Chief Executive Officer Barry McCarthy said in a letter to shareholders.
“We finished the quarter with $879 million in unrestricted cash and cash equivalents, which leaves us thinly capitalized for a business of our scale.”
The company said it had signed an agreement with JP Morgan and Goldman Sachs to borrow $750 million in 5-year term debt.
Like many stay-at-home winners, the fitness equipment maker is grappling with plummeting demand.
The company’s market value has tumbled to $4.69 billion from nearly $50 billion during the pandemic when its bikes and on-demand fitness content were lapped up.
The company said connected fitness subscribers for the fourth quarter will be about 2.98 million, compared to FactSet estimates of 3.01 million.