A Peloton stationary bike for sale in the company’s showroom in Dedham, Massachusetts, U.S., Wednesday, February 3, 2021.
Adam Glanzman | Bloomberg | Getty Images
Peloton will expand its rental program nationwide, the company announced Tuesday.
The announcement came a day after Peloton unveiled sweeping leadership changes, including the departure of co-founder, executive chairman and former CEO John Foley as well as co-founder and chief legal officer Hisao Kushi.
investment related news
The rental program began in test markets at physical Peloton stores in Texas, Florida, Minnesota and Colorado. For $89 per month, customers will be able to rent an original Peloton bike and get a membership. There is an additional installation fee of $150. They can also opt for the Bike+ for $119 per month.
The rental program comes shortly after the company began selling Certified Used bikes and the announcement that Peloton would begin selling products on Amazon. The moves help increase the accessibility of cycling, bringing new users into Peloton’s subscriber base.
They are part of CEO Barry McCarthy’s aggressive turnaround plan. He took over the role from Foley earlier this year after the company announced massive layoffs. Since then, McCarthy, a Netflix and Spotify veteran, has pushed for a more subscriber-centric business model.
“I don’t think we’re a hardware company. We’re a software company. We’re in the business of engineering great user experience,” McCarthy said at the Goldman Sachs Communacopia and Technology conference on Monday. .
He added: “A very small percentage of the monetary value that we collect from users that we collect when you purchase hardware. The vast majority is lifetime value that accrues month after month, month after month in the form from the $44 subscription fee.”
Shares of Peloton were down around 14% on Tuesday morning amid a broader market rout.