Peloton's App Revenue Grew 30% in January

Peloton hasn't had it easy in 2022. The maker of workout equipment had a wild pandemic ride. Demand for its overpriced equipment skyrocketed as gyms shut down and most of us moved to work from home, around the same time it went public, and things were looking great.

But demand eventually wore off and sales started declining. Competitors started pushing their lower-cost equipment, and that all culminated with a massive loss of nearly half a billion dollars in Q4.

Now, there's talk of Peloton being sold, and Amazon is interested.

So that's a lot of not-so-great stuff. But there's actually something that is growing for Peloton and that's in-app revenue. So a potential acquirer could tap into that.

Peloton followed a trend many other fitness apps followed in 2020, they moved a lot of at-home fitness content into the app and locked it behind a subscription. Momentum doesn't build up overnight, but once it moves it's hard to stop, and that's what we see here.

In-app revenue rose more than 1,000% since the beginning of 2020. According to our estimates, Peloton added more than $4.2M to its bottom line. It's not enough to undo their losses, but if we look at it as a separate business--a content business--it's pretty lucrative.

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