Peloton to halt production of its Bikes, treadmills as demand wanes

They are a better content company than a software company. As you note, they currently have the best music, instructors and variety of classes. But the software itself has a LOT of room for improvement. For example, the now playing widget is constrained to a tiny little chunk of the view in which artist names or titles are routinely truncated beyond recognition even though most of the screen is essentially empty (a view of a big black studio with an instructor in the center).

This might all be true, but it's independent of waning demand and overinflated share price that tanked (why CNBC really cares). The real story is even good products can reach saturation. It will probably happen to even iPhone. If you take a step back and look at any business as a growth machine, you have to ask where the growth is going to be. You can say they are a better software company or content company, but that really only extends them into a hyper competitive space. There is an infinite amount of choice with software. It really boils down to the hardware + software combination that gives them unique value in the market. The trouble is a single purpose product with a single purpose subscription is very tough. You need a really strong use case. Kindle unlimited has "reading" as a use case. XBox game pass has "pc gaming" as a use case. These are all pretty substantial use cases. Probably bigger than biking indoors. And yet, even those subs are going to have a long and slow growth curve over their existing bases.

EDIT: I mean saturation in the context of pull forward demand due to covid. Not saturation in that people will stop buying. There is always upgrade cycles.

They are an upscale home fitness brand that happens to make decent products for introverts, time sensitive professionals, and others who can't make it to a gym.

> I can't help but wonder if they ever really believed what they were selling.

At least some weren’t. Lots of insider selling:

https://www.nbcnews.com/business/business-news/peloton-insid...

I tend to think the problem is just inherent to business. When business is booming nobody thinks are we going to keep this up? Are there factors that may cause this growth to slow? Generally they just make higher sales targets for next year. I tend to believe the market is just saturated now with exercise equipment. Plus you have a large number of people who didn’t get to keep working from home so unlikely to invest in a expensive piece of equipment. Peloton snagged a large group of management and exec level people at my agency, and they all love to talk about it. Which on the one side is great because they are all working out and trying to stay healthy. But on the other side people who aren’t on the Peloton train don’t give a damn about it and are sick of it coming up at nearly all meetings.

I bought a few shares in May of 2021 so I'm feeling it a bit. May also just buy the dip :)