Peloton Interactive

Founding to IPO

In 2011, John Foley, an executive at Barnes & Noble in New York City, pitched his colleague, Tom Cortese, on the idea that technology could make it possible for people with little time to get the full experience of working out in a high-end studio cycling class in their homes.[5] Peloton Interactive was founded in January 2012.[6] "Peloton" is a cycling term, meaning a large group of riders bunched together.[7]

The company raised $400,000 in seed money in February 2012 and another $3.5 million in December 2012.[8] Peloton sold its first bike on Kickstarter in 2013 with an early bird price tag of $1,500.[9] Their first Internet-connected stationary bicycle with a tablet was released in 2014.[10][11] The company also opened showrooms in shopping centers around the US, for people to test out the machines, and "sales quickly soared" for the classes, encouraged by the online community of riders.[11]

Peloton’s original treadmill, Tread+, was unveiled in January 2018 by the company at the annual Consumer Electronics Show in Las Vegas. In May 2018, Peloton announced plans to expand into Canada and the United Kingdom that fall.[12] It also announced construction of a flagship studio at Manhattan West in New York City.[13]

In March 2019, Peloton was sued by the National Music Publishers Association for using copyrighted music in their videos without proper synchronization licenses, seeking $150 million in damages.[14] The action resulted in changes to music used in its sessions, as well as removal of certain programs that used the songs named in the suit.[15] In September 2019, the suit was amended and increased to $300 million.[16] Peloton settled the lawsuit in February 2020; financial terms were not disclosed.[17]

On September 26, 2019, Peloton (ticker symbol: PTON) became a public company via an initial public offering, raising $1.16 billion and valuing the company at $8.1 billion.[18][19] After reaching a market valuation of $50 billion in January 2021, the company's valuation was back to around $8 billion by April 2022. As of March 2025, Peloton's valuation is approximately $2.5 billion.

The Gift That Gives Back ad

In November 2019, the company released a new holiday commercial, "The Gift That Gives Back", where a wife, played by Monica Ruiz, receives a Peloton bike for Christmas from her husband, and, after using it, observes that she "didn't realize how much this would change me". The commercial received criticism from viewers who claimed that its plot implied that the woman's husband was dissatisfied with her physical appearance.[20]

Peloton defended the ad, arguing that it was intended to celebrate a "fitness and wellness journey" that was inspired by how its users were often "meaningfully and positively impacted after purchasing or being gifted a Peloton Bike or Tread, often in ways that surprise them".[21][20] Ruiz, the actress that played the wife, was hired for an ad titled "The Gift That Doesn't Give Back" for Aviation American Gin, released in December 2019, which lightly mocked the Peloton ad.[22][23]

COVID-19 pandemic through 2021

Sales increased significantly during the COVID-19 pandemic as home gyms became more popular during the COVID-19 lockdowns.[24] However, the rapid increase in demand caused shipping delays, with customers receiving their products months late, leading some to cancel orders.[25] In December 2020, the company made a $100 million investment in shipping solutions in an attempt to accelerate manufacturing and decrease shipping times.[26]

Flywheel Sports lawsuit settlement

Due to Peloton's success, at least a dozen rivals, including Equinox, Icon Health & Fitness, and Flywheel Sports, began selling Peloton-style internet-connected bikes.[11] In February 2020, Flywheel ceased its at-home cycling services after settling with Peloton over a patent lawsuit. Flywheel created its at-home internet-connected bike in 2017,[27] and later admitted it illegally copied Peloton's technology. Court documents revealed that Flywheel created an internal initiative to obtain Peloton's confidential trade information.[28] After Flywheel's service shut down, Peloton offered Flywheel users the opportunity to exchange their Flywheel bikes for refurbished Peloton bikes at no cost.[29]

Tread and Tread+ safety recall

In May 2021, the U.S. Consumer Product Safety Commission warned people with children and pets to immediately stop using the Tread+ model of Peloton treadmill, after one child died after being pulled under the treadmill while a parent was running on it, and almost 40 others sustained injuries including fractured bones.[30][31][32] The commission stated that when not in use, the product should be stored in a locked room to prevent children and pets from accessing it.[33][34]

Peloton initially rejected the Consumer Product Safety Commission's request to recall the product and instead warned parents to keep children away from the treadmill, before it changed course and voluntarily recalled the Tread and Tread+ on May 5, 2021.[35]

Sex and the City plot point

In December 2021, on the first episode of the Sex and the City reboot And Just Like That..., the character Mr. Big (played by Chris Noth) has a heart attack and dies after riding a Peloton bike.[45] The day after the initial airing of the episode, Peloton shares fell 11.3%.[46] The company issued a statement through Dr. Suzanne Steinbaum, a cardiologist and member of the company's health and wellness advisory, saying that they agreed to the product placement but were not aware of how it would be used in the pivotal scene.[47]

The statement also said not to blame the company for the character's death, and cited some contributing factors, such as his lifestyle (e.g., his consumption of steaks and cigars) and a cardiac surgery in a previous season.[48] The company released an ad, narrated by Ryan Reynolds, with Reynolds citing the benefits of cycling and ending with, "He's alive."[49]

Stock turbulence and CEO changes

In January 2022, CNBC reported, citing internal company documents, that Peloton had temporarily paused production of its products after greatly increased demand during the early stages of the COVID pandemic had slackened, leaving the company with a glut of bikes and treadmills. The company denied the report.[53] Peloton's share price quadrupled in 2020, before dropping nearly 80% in 2021.[54][55]

In February 2022, 2,800 employees were laid off in an effort to save $800 million annually. CEO John Foley stepped down from his position, becoming executive chairman, and was replaced by Barry McCarthy, the former chief financial officer of Spotify and Netflix.[56][57]

Safety recall in 2023

In May 2023, the Consumer Product Safety Commission announced the recall of 2.2 million of the company's Model PL01 exercise bicycles (introduced in 2018 and still a current production product) after 35 reports of seat posts breaking, including 13 reports of injuries that included one fractured wrist, lacerations and bruising. Owners of the devices were told to "immediately stop using" them until they could be repaired.[76][77]

Bike and Bike+

The Peloton Bikes are internet-connected stationary bicycles with a touchscreen that streams exercise classes to the rider.[78] The device touchscreen operates on a custom version of Android.[79] Classes can also be accessed through the Peloton App or website. Classes can be cast from the Bike to a TV using Miracast, and can be cast from the App or website to a TV using iOS and Android devices, such as AirPlay and Chromecast. Users could video chat with friends during classes, however that feature was discontinued in June, 2022.[80] Those who purchase the Bike then pay a monthly subscription fee for access to live-streaming and on-demand classes through the tablet.[81]

Classes and instructors

While Peloton's flagship offerings are cycling and running classes using their exercise machines, they also offer classes in strength training, yoga, cardio aerobic exercise, meditation, stretching, Pilates, tread bootcamp, bike bootcamp, and walking.[101][102][103] Classes are recorded daily and streamed live from instructors' homes or Peloton's cycling studios in Hudson Yards, Manhattan and London and are then uploaded to the Peloton library for on-demand access 24/7.[104][105]

Showrooms

Peloton has physical retail locations where prospective customers can learn about Peloton's offerings and products, and take a trial class on the Bike or Tread. The first location was at the Mall at Short Hills in New Jersey. As of 2022, Peloton has 97 showrooms in the United States and Canada, 5 in Australia, and 39 in the United Kingdom and Germany.[121][122][123]

Peloton Homecoming event

The Homecoming event was originally organized by fans of the Peloton products in 2016 but, having gained the attention of the company, was adopted as a company-sanctioned event. It was held in person up to 2019 with a small-scale online fan event held in 2020.

At the beginning of May 2021, Peloton held a free online Homecoming event, consisting of three days of special classes, panel discussions on fitness and the introduction of new features and instructors.