Peloton shares tumble 24% after it reports losses of $376M in the wake of infant treadmill recall while Airbnb profits surge 280% to $2.24B

• Peloton shares dropped 24% on Thursday after the company reported a net loss of $376 million in its third quarter
• The company is struggling to recover from treadmill recall sparked by an infant’s fatal accident and 29 other injuries 
• Airbnb profits have skyrocketed in the third quarter by $2.24 billion, or a whopping 280%
• The company is succeeding as more travelers are comfortable getting on the road again
• Uber lost $.24 billion due to a drop in the value of its investment holdings in other ride-sharing apps

Peloton shares plunged 24% on Thursday after the company reported a net loss of $376 million in its third quarter, as the company struggles to recover from a voluntary treadmill recall sparked by an infant’s death and 29 other injuries.

Meanwhile, Airbnb profits have skyrocketed in the third quarter by $2.24 billion, or a whopping 280%, as more guests are comfortable traveling again.

Other digital companies seeing significant changes in third quarter results include Uber, which lost $2.4 billion due to a drop in the value of its investment holdings in other ride-sharing apps. Lyft also saw a drop in third-quarter revenue, as losses came in at $71.5 million.

Peloton is searching for ways to keep revenue growing and find new customers, which has been particularly difficult after recalling their treadmill earlier this year due to the death of a child pulled under its belt, and the injuries of 29 others.

Peloton shares took a steep drop by 24% on Thursday after the company reported a net loss of $376 million in its third quarter

Peloton shares fell between July and September, as the company struggles to recover from a voluntary treadmill recall sparked by an infant’s fatal accident and 29 other injuries

Shares dropped by 24% today after the company announced its third quarter results

For the three-month period ended Sept. 30, Peloton reported a net loss of $376 million, or $1.25 per share, compared with net income of $69.3 million, or earnings of 20 cents a share, a year earlier. Analysts expected Peloton would see a loss of $1.07 per share, CNBC reported.

Peloton revenue grew 6% to $805.2 million from $757.9 million a year earlier, missing it estimates for $810.7 million. Peloton’s sales of its connected fitness products, including its bikes and treads, fell 17% to $501 million.

Subscription revenue rose by 94% to $304.1 million. Connected fitness sales accounted for 62% of Peloton’s business in the quarter.

Peloton had 2.49 million connected fitness subscribers, or those who own a Peloton product and pay a monthly fee to access the company’s digital workout content at the end of the third quarter, which was an increase of 87% from the previous year.

Peloton temporarily stopped making their treadmills due to the death of a child and the injuries of 29 others. In a video released by the Consumer Product Safety Commission, a young boy is seen walking behind the Peloton Tread+ with a large pink ball while a young girl is on it, which gets pulled under the treadmill

In August, Peloton lowered the price of its original Bike to $1,495 – a nearly 20 per cent price cut from the $2,245 it costed this time last year.

This came after Peloton temporarily stopped making their treadmills due to the death of a child and the injuries of 29 others. 

In a video released by the Consumer Product Safety Commission, a young boy is seen walking behind the Peloton Tread+ with a large pink ball while a young girl is on it, which gets pulled under the treadmill. 

The August price drop marked the second time Peloton has reduced the original Bike’s price. When the Bike+ machine debuted last September for $2,495 the original bike’s price was slashed to $1,895. 

The popular at-home fitness equipment maker rocketed in popularity during the pandemic as people desperate to stay fit while gyms were closed bought its bikes. 

That also sent the firm’s stock price soaring. But gyms began reopening last fall, and masking rules relaxed further this year as the availability of COVID vaccines increased, with many people now choosing to return to the weights room and in-person group class instead.  

Airbnb profits have skyrocketed in the third quarter by $2.24 billion, or a whopping 280%

Airbnb shares has climbed slightly today after the company revealed its third quarter success

The company is succeeding as more travelers are comfortable getting on the road again post-pandemic

On Thursday, Chief Financial Officer Jill Woodworth said that Bike sales did increase after the change, but not in the way the company had hoped.

‘While the price drop led to conversion rates that exceeded our forecast, overall traffic has not met our initial expectation. We’ve also seen a richer than anticipated mix of Bike sales versus Bike+, further impacting both revenue and our growth margin expectation,’ Woodworth told analysts on an earnings call, CNBC reported.

Peloton’s gross margins in the latest quarter fell to 12% from 39.4% a year earlier.

Foley added that the company still has more work to do to educate consumers about the Tread product. However, he still believe treadmills will grow to one day be a bigger category for Peloton than bikes.

Airbnb saw a surge in profit growth during the third quarter as the company continues coming back from the coronavirus pandemic and more travelers feel comfortable staying in their homes. Shares briefly climbed over 3% in after-hours trading Thursday as the company announced its 280% profit growth to $2.24 billion.

Gross booking value — which the company uses to track host earnings, service fees, cleaning fees and taxes — reached $11.89 billion in the third quarter and was up about 48% from the prior year.

The company drew media attention just yesterday after announcing that it is putting up for rent a stunning recreation of the Brownstone New York apartment in which Sex and the City’s Carrie Bradshaw character lived.

The company drew media attention just yesterday after announcing that it is putting up for rent a stunning recreation of the Brownstone New York apartment in which Sex and the City’s Carrie Bradshaw character lived. Sarah Jessica Parker (above), who played her, not only had a hand in designing it, but will welcome guests when they arrive

What’s more, Sarah Jessica Parker – who played her – not only had a hand in designing it, but will welcome guests when they arrive.

Parker says of the new Airbnb: ‘The Carrie Bradshaw character is near and dear to my heart, and revisiting her world for the continuation of the Sex and the City story has been such a joy.’

Carrie’s brownstone apartment was central to the series, and its décor has now been painstakingly recreated by Parker, Airbnb, and a small, New York-based production team. The character’s famous walk-in wardrobe, her writing desk, and her bedroom appear almost exactly as they did in the cult series.

While Airbnb had success in the third quarter, Uber had a setback and reported a net loss of $2.4 billion for the quarter. The dip came mostly because of a drop in the value of its investment holdings, particularly in Didi.

Didi, a Chinese largest ride-hailing platform, went public in July and since then it has faced scrutiny from Beijing on data security, privacy and worker protections. That crackdown caused Didi’s stock price to tumble and led to a $3.2 billion hit for Uber, which sold its Chinese business to Didi in 2016 in exchange for equity, according to the New York Times.

Uber, which saw a net loss of $1.09 billion in the same quarter a year ago, said its stakes in other platforms, Zomato, Aurora and Joby, helped offset some of that loss.

Digital firms profits and losses 

Peloton: Shares dipped 24% after the company reported that profits dropped $376 million in the third quarter

Airbnb: Profits skyrocketed by 280% and were at $2.24 billion in the third quarter

Uber: Shares were up by 1% and the company lost $2.4 billion in the third quarter

Lyft: Shares rose by 12%, despite third quarter revenue dropping by $71.5 million

Square: The digital payment platform’s total gross profit for the third quarter came in at $1.13 billion

Pinterest: Company shares rose 6.3% after the company reported that profits climbed by $94 million in the third quarter

Roku: Shares dropped by 9% on Wednesday after the company reported less-than-expected profits of $364 million in the third quarter

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