Posts Tagged: Hard

Peloton’s huge loss highlights how hard it’ll be to turn things around

Peloton has posted a heavy quarterly loss for the first quarter, indicating that it has a lot of work to do in order to correct course. The company made a net loss of $ 757.1 million in the first three months of the year (Q3 of Peloton's 2022 fiscal year). Not only was that a worse result than expected, it's a massive decrease from the $ 8.6 million loss it posted for the same period in 2021.

Revenue dropped from $ 1.262 billion a year ago to $ 964 million. Operating expenses, meanwhile, grew by 101 percent year-over year to $ 920 million. Peloton says those represented 95.4 percent of total revenue for the quarter, compared with 36.3 percent a year earlier.

One of the company's biggest challenges has been handling its stockpile of connected fitness equipment in the wake of a sales decline as more people return to office life. "We have too much [inventory] for the current run rate of the business, and that inventory has consumed an enormous amount of cash, more than we expected, which has caused us to rethink our capital structure," CEO Barry McCarthy, who took on the job in February, wrote in a letter to shareholders. "We believe the inventory will sell eventually, so this is primarily a cash flow timing issue, not a structural issue."

Around the time McCarthy was appointed, Peloton announced it would cut 2,800 jobs, or around 20 percent of the corporate workforce. Rumors swirled in February that the company was an acquisition target for several suitors, with the likes of Amazon and Nike said to be interested.

Although it won't be easy for the company to get back on track, Peloton at least has a plan to turn things around. It aims to return to positive free cash flow in its 2023 fiscal year.

Last month, it announced an upcoming increase to subscriptions along with price cuts for many of its connected fitness machines. There are several reasons why Peloton is banking more heavily on subscriptions. For one, subscription revenues rose by 55 percent year-over-year to $ 369.9 million. The company now has 7 million members, and McCarthy has a long-term goal of reaching 100 million. "Our users are highly engaged, and our subscriber churn rate is less than 1 percent, which is the best I’ve seen," McCarthy, a former Netflix and Spotify executive, said.

McCarthy said the pricing changes could help the company deliver "roughly $ 40 million of incremental revenue monthly." The increased cost of the All-Access plan doesn't kick in until June 1st, but McCarthy says there's only been a small increase in user attrition and the move will generate an extra $ 14 million in revenue each month if that level of churn holds.

Cutting prices on some hardware models has led to a 69 percent increase in daily unit sales too. So far, that move has increased revenue by $ 25 million per month. The company also plans to keep testing a program that will combine an All-Access subscription plan with rentals of its equipment.

McCarthy noted that Peloton is revamping its workforce as it shifts from a hardware- to a software-focused company. The recent job cuts factor into the company's plan to increase annual run-rate savings to at least $ 800 million by its 2024 fiscal year. It also signed a binding commitment letter to borrow $ 750 million in five-year term debt from JP Morgan and Goldman Sachs.

Meanwhile, Peloton says more than half a million users have tried Lanebreak, its first gamified workout, on Bike and Bike+. The company expects to lean "more into gaming content in response to the success of Lanebreak."

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The best external hard drives

By Justin Krajeski This post was done in partnership with Wirecutter. When readers choose to buy Wirecutter's independently chosen editorial picks, Wirecutter and Engadget may earn affiliate commission. Read the full external hard drives guide here….
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WD is developing 40TB hard drives powered by microwaves

Western Digital (WD) may have lost a bid to buy Toshiba's flash memory technology, but is still hard at work on its bread-and-butter hard drives. The company has unveiled a breakthrough called microwave-assisted magnetic recording (MAMR) that will al…
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[TA Deals] Snatch Paragon’s Hard Disk Manager 15 for under $25

Our latest featured deal of the day involves a service that manages your computer’s data, protecting you from losing everything in the event of a ransomware scam. Head over to Talk Android Deals to see what it’s all about. Snapshot-driven backup & powerful recovery features Resizes partitions & redistributes unused space Recovers lost or accidentally […]

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Camera hard to hold? Olloclip introduces a hand grip for smartphones, GoPros

Smartphones and action cameras can be hard to hand-hold, but the Olloclip Pivot makes it a bit easier, thanks to an ergonomic grip. It rotates 225 degrees to provide a comfortable hold from a variety of different shooting angles.

The post Camera hard to hold? Olloclip introduces a hand grip for smartphones, GoPros appeared first on Digital Trends.

Mobile–Digital Trends

Limited edition, Olympic Apple Watch bands look awesome, but will prove hard to get

Apple will make special, limited edition straps for the Apple Watch in designs inspired by the national flags of different countries competing in the upcoming Olympic Games. They’re just $ 50 each, but you’re going to need to be at the Games to grab one.

The post Limited edition, Olympic Apple Watch bands look awesome, but will prove hard to get appeared first on Digital Trends.

Wearables–Digital Trends

Neit debuts world’s first collapsible, hard case suitcase

Premium quality luggage brand Néit developed a line of suitcases that can be collapsed to nearly 70 percent its original size, making it convenient to store away when it’s not in use.

The post Neit debuts world's first collapsible, hard case suitcase appeared first on Digital Trends.

Cool Tech–Digital Trends

Getting Christmas right was never this hard for my parents

The most my parents generally had to do for a Christmas present was remember to buy batteries. Okay, maybe I'm underselling their role. One year they got me a bike, and somehow kept it hidden from me until the big day. I would've been five at the tim…
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10 stories you missed: Digital rat brains, YouTube tycoons, Die Hard 6

It can be challenging to keep track of everything that happens in the tech world. That’s why we have compiled a list of the top 10 tech stories from this week — just for you. From Facebook’s data on coming out on social media to Apple’s surprising patent loss, it’s all here.

The post 10 stories you missed: Digital rat brains, YouTube tycoons, Die Hard 6 appeared first on Digital Trends.

Cool Tech»Digital Trends