Peloton became a household name during the pandemic. The at-home fitness company's stock surged more than 500% by Dec. 23, 2020, quickly boosting the small start-up into mega-cap status in less than a year.
But as the economy reopens, gyms and in-person studios are also attracting people to work out outside of the home.
Competition in the at-home fitness space has also increased, with companies such as Tonal, Hydrow, Lululemon's Mirror and Apple offering their own fitness equipment to customers. "We're going to continue to see now this as the market space grows, as increasing amount of companies realize that this is a new industry that should be unlocked, the fight for customers' mind share is going to get harder," Simeon Siegel, managing director at BMO Capital Markets, told CNBC.
In early November 2021, Peloton reported disappointing first-quarter results that missed on earnings, revenue projections and full-year guidance. It showed slowing demand for its products and an anticipated increase in marketing spend. In the same month, the company shed $10 billion of its market cap as the stock price plummeted. Its stock took another move lower this week after HBO's "Sex and the City" reboot featured its cycle in the first episode, connecting the cycle to the death of a character on the show. The company attempted to do damage control by releasing a parody video starring actor Chris Noth, but then had to pull the video after sexual misconduct allegations were made against the actor.
Watch the video above to learn how Peloton can compete in the crowded fitness sector and what investors should think about as the world returns to a new normal.