Peloton Interactive Inc. tumbled as much as 15% to 97% during after hours, after the fitness company warned that a price cut would hurt its bottom line this year and that it found a problem with the way it accounts for inventory.
Peloton released its quarterly results and reported a worse-than-expected outlook for 2022. The price cut, also announced Thursday, will lower the cost of Peloton’s most popular bike by $400 to $1,495, part of a bid to make the upscale product more mainstream. And Peloton is now offering financing plans that last as long as 43 months, up from 39 months, which will lower monthly payments for its higher-end bike and treadmill.
The company also pointed out a problem with its accounting. An audit of fiscal 2021, which ended June 30, found “a material weakness” in the internal controls that govern Peloton’s financial reporting. The problem stemmed from a discrepancy in the company’s year-end inventory counts.
