Peloton announced Tuesday the launch of a corporate wellness program as it aims to reach new users and grow its membership base.
Businesses that sign up will be able to offer employees subsidized access to Peloton’s digital fitness membership and its high-end cycles and treadmills. Peloton said its corporate partners will receive access to tailored features such as team tagging and group exercises that encourage accountability and foster bonding with colleagues. Peloton will also assist corporate partners with outfitting office workout spaces.
The online furniture retailer Wayfair, electronics maker Samsung, software giant SAP and British telecommunications firm Sky are among the first businesses to join the program, Peloton said.
Peloton shares were falling less than 1% in premarket trading.
Peloton President William Lynch said the offering promises to become one of its biggest growth channels.
Peloton started investing in the corporate wellness platform about a year ago, as it began to receive requests from companies to partner, he said.
“With the return to work, and as companies acknowledge that they need healthy employees — especially coming off the pandemic — we’ve seen incredible demand for the platform,” Lynch said. “We feel like our timing is great.”
Financial terms weren’t disclosed.
The perk could help companies lure talent back to the office post-pandemic or assist in retaining staff in a tight labor market. Employees are increasingly seeking out health-related benefits at the office. They’re also looking to earn a paycheck from businesses that maintain a balance between life and work. And after a year where life was turned upside down for so many, people seem to be more cognizant of maintaining their physical and mental health.
“The crux of it is, employers see the benefit of the connection between healthy employees and productivity,” Lynch said.
In addition to cycling and running content, Peloton’s fitness app also includes mediation, yoga and strength classes. A digital membership for people who don’t own any Peloton equipment costs $12.99 per month. An all-access membership is $39 a month.
Demand for Peloton’s equipment and memberships surged during the pandemic, fueling a more than 400% runup in the company’s stock. Shares are down nearly 29% year to date, however, as investors worry people may lose interest in working out at home and head back to the gym or boutique fitness studio.
Last year, Peloton saw incredible momentum, as revenue doubled to $1.8 billion from $915 million a year earlier. As of March 31, Peloton had 2.08 million connected fitness subscribers — people who own a Peloton product and pay a monthly fee for access to its workout content.
The company’s growth hasn’t come without problems. In May, Peloton recalled its Tread+ and Tread treadmills over safety concerns. And earlier this month, software security company McAfee said it exposed a vulnerability in its Bike+ that allowed hackers to install malware through a USB port and potentially spy on riders. The flaw has since been fixed.
Cassidy Rouse, Peloton’s vice president of new market development, will transition to oversee its corporate wellness initiative and report to Chief Revenue Officer Tim Shannehan.
Disclosure: Comcast owns CNBC’s parent NBCUniversal and Sky.
Source: Business - cnbc.com
