Peloton (PTON) earnings Q1 2026

peloton On Thursday, it posted its second consecutive profitable quarter, issuing a strong forecast for the critical holiday shopping season, banking on a relaunched product line to fuel growth.

The connected fitness company reported a net income surprise of $13.9 million in the three months ended Sept. 30, compared to a loss of $900,000 a year earlier.

For Peloton’s strongest quarter in terms of hardware sales, the company expects revenue to be between $665 million and $685 million, according to LSEG; That’s a slight increase from the previous year and substantially better than Wall Street expectations of $665 million.

Peloton also raised its full-year adjusted EBITDA outlook and now expects it to be between $425 million and $475 million at both ends, up $25 million from its previous outlook. Most of that estimate is above analysts’ expectations of $400 million to $450 million, according to StreetAccount.

Shares rose nearly 11% in extended trading Thursday.

Despite the good news, Peloton is still dealing with problems from its past. Earlier Thursday, it announced it was initiating another recall of its first line of products. The Consumer Product Safety Commission said the company is recalling 833,000 original Bike+ devices after receiving reports that the seat post could break and separate while riding; This was the same issue that led to a recall of the base Bike model in 2023.

“We have received a small number of reports of original Bike+ series seatposts breaking during use. As of today, we are aware of three such incidents,” Peloton CEO Peter Stern said on the company’s earnings call Thursday.

Peloton’s latest recall cost the company $13.5 million in the quarter reported Thursday and contributed to a 0.3 percentage point decline in gross margin.

For its fiscal 2026 first quarter announced Thursday, Peloton beat analyst expectations on both the top and bottom lines.

Here’s how the fitness company performed in its first fiscal quarter compared to Wall Street expectations, according to a survey of analysts by LSEG:

• Earnings per share: 0 cents expected versus 3 cents
• Revenues: 551 million dollars, while the expectation was 540 million dollars

Sales fell nearly 6% to $551 million from $586 million the year before.

Under Stern, who took the helm in January, the connected fitness company is completing cost cuts and turning its attention back to growth, as it now returns to generating steady free cash flow and operating profitably.

“Our goal is to go far beyond that. [cardio connected fitness]… we have strength, we have mental and mental health, nutrition, hydration, sleep and recovery,” Stern said. “We’re focused on growth, but the growth has to be profitable … both in terms of top-line growth and the incremental margins associated with this business.”

Last month, Peloton relaunched its product assortment, introducing a commercial equipment line and increasing prices for both subscriptions and hardware ahead of the holiday shopping season.

The renewed product range, which touches on bicycle, rowing machine and treadmill products, includes an artificial intelligence-supported tracking camera, speakers, 360-degree rotating screen and hands-free control, among other new features.

“The fact that we are launching a completely new product line with a cross-training line is a great reason for us to talk to our members and non-members,” Stern said.

Peloton believes consumers will be willing to spend big on these products for lavish holiday gifts for themselves or a loved one. But with just over a month until launch, it remains unclear how they perform. The company’s first fiscal quarter ended a day before the launch of new products.

Across the retail industry, the personal electronics category is under pressure.

While Peloton operates in its own category, shoppers are pulling back on other major products and becoming more careful about where their dollars go in an unstable economic environment.

Following Peloton’s latest recall, the company said it faced higher-than-expected membership loss and resulting costs.

– CNBC’s Luke Fountain contributed to this report