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Peloton is partnering with TikTok to bring short-form fitness videos and other content to the social media channel.
The partnership comes as Peloton looks to attract a wider array of customers and boost subscribers amid falling sales and profits.
In May, Peloton rebranded as a fitness company “for all,” and is still working to get that message out to the public.

Peloton has launched a partnership with TikTok.
Courtesy of: Peloton

Peloton launched a partnership with TikTok on Thursday as part of its strategy to change its public perception and attract a broader array of customers as sales and profits fall. 
The partnership will create a new fitness hub on the social media platform dubbed “#TikTokFitness Powered by Peloton.” It will feature short-form fitness videos, longer live classes, content from Peloton’s instructors and collaborations with TikTok creators. 

Shares of Peloton rose about 10% in pre-market trading after the news was announced.
It comes about six months after Peloton rebranded itself as a fitness company “for all” and launched a tiered pricing strategy for its app. The changes were designed to position Peloton as more than just a bike company and bring in new customers who may not have been able to afford its pricey connected fitness equipment but could be interested in a monthly subscription for its content. 
“On the one hand, there’s a longer-term goal around changing perceptions around who Peloton is for to multiple different types of audiences and I think one of the real strengths of TikTok … is that it increasingly reaches everyone, including the younger audience,” Oli Snoddy, Peloton’s vice president of consumer marketing, told CNBC in an interview. In the short term, the partnership will seek to build on what Peloton says has been a successful relaunch by boosting metrics such as app downloads and conversions, said Snoddy. 
During the Covid-19 pandemic, Peloton became a Wall Street darling after gyms shuttered and consumers flocked to buy its stationary bikes and at-home treadmills. But demand plummeted when the virus receded and consumers returned to normalcy. 
In the three months that ended Sept. 30, Peloton lost 30,000 members and revenue fell to $595.5 million, down from $757.9 million three years earlier at the height of the pandemic. 

Peloton CEO Barry McCarthy, who replaced the company’s co-founder John Foley in February 2022, has been working to rightsize the business and set it up for long-term growth and profitability. He has focused on boosting Peloton’s subscriber count and opening up new pathways to owning Peloton equipment by offering a rental service and refurbished options. 
While the initiatives are showing early signs of progress, Peloton still isn’t making money off the members that it has, making partnerships with companies such as TikTok and Lululemon critical to its long-term success. 
“We have over a billion users across the globe of all demographics,” Sofia Hernandez, TikTok’s global head of business marketing, told CNBC. “People from 16 to 60 are on the platform and when I think about [Peloton’s] campaign of ‘anyone and anywhere,’ there’s not a better place to reach that level of audience we have, that level of a diverse audience.” 
Hernandez noted that the partnership will go beyond workout videos and will include “behind the scenes” videos such as “get ready with me” clips and other fitness-adjacent content that gives people on TikTok an inside look into Peloton and its instructors. At first, the content will feature well-known instructors such as Cody Rigsby and Ally Love, but the partnership also hopes to introduce some of Peloton’s lesser-known instructors to a wider audience and boost their followings. 
“We know that when people experience Peloton, they really get it, they fall in love,” said Snoddy. “This is really about taking the instructors and the content we have and kind of dimensionalizing it to a broader audience on TikTok.”Don’t miss these stories from CNBC PRO: More

Online spending during the holiday season shot up nearly 5% to $222.1 billion in November and December, according to Adobe Analytics.
Shoppers got drawn in by retailers’ deep discounts and leaned on buy now, pay later more than in previous holiday seasons.
Yet Adobe’s holiday total excludes in-store spending and may not capture whether consumers spent more than they can afford.

A UPS worker sorts packages in New York on Dec. 18, 2017.
Adam Jeffery | CNBC

Online spending rose 4.9% year over year, setting a record for e-commerce during the holiday season, as shoppers pounced on discounts and leaned on buy now, pay later to cover more of their purchases, according to Adobe Analytics.
Sales totaled $222.1 billion on retailers’ websites and apps from Nov. 1 to Dec. 31, according to Adobe.

Adobe’s data covers more than 1 trillion visits to U.S. retail websites, 100 million unique items and 18 total product categories.
This year, more purchases rather than higher prices drove spending, Adobe said.
Prices have been falling across many product categories sold online, such as electronics. E-commerce prices have dropped for over a year, and were down 5.3% year over year in December, according to Adobe’s Digital Price Index, which tracks online prices across 18 product categories. If Adobe adjusted for inflation, online consumer spending would have grown even more during the holiday season.
Strong spending during the critical season could bode well for Walmart, Amazon, Target, Macy’s and other retailers, if they attracted a healthy share of those dollars. For most major retailers, fourth-quarter earnings season kicks off in February, and those reports will give a clearer picture of the companies that gift-givers and party hosts favored.
Yet strong online holiday sales may not mean consumers will spend freely in the new year. Some shoppers may shell out more than they can afford during the peak shopping season, and could pull back in the months ahead as the bills come due.

One reason for big spending in November and December? Big discounts. Adobe found that discount levels hit record highs during the holiday season.
For example, discounts peaked at 31% off listed price in the electronics category, compared with a peak of 25% during the holidays in 2022. Price cuts topped out at 24% for apparel, compared with a peak of 19% during the holidays in 2022.
Cyber Week, the five days between Thanksgiving and Cyber Monday known for compelling deals, accounted for $38 billion of online holiday sales — or nearly one in five dollars spent during November and December. Spending during the promotional period rose 7.8% year over year.
Buy now, pay later, a financing option that has become easier to use on retailers’ websites, proved more popular this holiday season, too. The payment plans, which are offered by companies like Affirm and Klarna, allow shoppers to pay off items in smaller installments over time.
Use of buy now, pay later hit an all-time time and contributed $16.6 billion in online spending during the holiday season, Adobe found. That’s a 14% jump from the year-ago holiday period.
Other holiday spending totals have come in rosier than expected, too. Retail sales during the holiday season, excluding automotive sales, increased 3.1% in the U.S. year over year, according to preliminary data from Mastercard SpendingPulse. The company measures in-store and online retail sales across all types of payment, and its total is not adjusted for inflation.
In a news release, Mastercard Economics Institute’s Chief Economist Michelle Meyer credited a healthy jobs market and easing inflation for giving consumers confidence to spend.
The company also found sharp growth in online spending during November and December. Online retail sales rose 6.3% year over year compared to a 2.2% increase for in-store spending, according to Mastercard. But online shopping remains a smaller portion of overall holiday spending. More

Walgreens reported fiscal first-quarter adjusted earnings and revenue that topped expectations, but cut its quarterly dividend nearly in half.
The retail pharmacy giant slashed its dividend to 25 cents per share from 48 cents per share to “strengthen its long-term balance sheet and cash position,” according to CEO Tim Wentworth.
Walgreens reiterated its fiscal 2024 adjusted earnings guidance of $3.20 to $3.50 per share. 

Walgreens reported fiscal first-quarter adjusted earnings and revenue that topped expectations on Thursday, but cut its quarterly dividend nearly in half. 
The retail pharmacy giant slashed its dividend to 25 cents per share from 48 cents per share to “strengthen [its] long-term balance sheet and cash position,” CEO Tim Wentworth, who officially took the helm during the quarter, said in a statement. 

Walgreens’ dividend yield is now 3.9%, based on Wednesday’s closing price. That’s down significantly from its prior yield of more than 7%, which made the company the highest-paying dividend stock in the Dow Jones Industrial Average. 
It also marks the company’s first dividend cut in nearly five decades. The dividend will be payable on March 12.
The dividend reduction comes as Wentworth, a health-care industry veteran, tries to steer the company out of a rough spot. 
Shares of Walgreens plummeted 30% last year as the company grappled with weakening demand for Covid products, low pharmacy reimbursement rates, increased pressure from online retailers, labor unrest among pharmacy staff in the fall, an uneven push into health care and a challenging macroeconomic environment.
But Thursday’s earnings beat marks a turnaround from October, when Walgreens missed earnings estimates for two straight quarters for the first time in nearly a decade.

Here’s what Walgreens reported for the three-month period ended Nov. 30 compared with what Wall Street was expecting, based on a survey of analysts by LSEG, formerly known as Refinitiv:

Earnings per share: 66 cents per share adjusted vs. 61 cents expected
Revenue: $36.71 billion vs. $34.86 billion expected

The company reported a net loss of $67 million, or 8 cents per share, for the fiscal first quarter.
That compares with a net loss of $3.7 billion, or $4.31 per share, during the same period a year ago, when Walgreens was ordered to pay a multibillion-dollar settlement for litigation alleging the company helped fuel the nation’s opioid crisis. 
The net loss in the most recent quarter included a $278 million after-tax charge related to Walgreens’ forward sale of shares of drug distributor Cencora, formerly known as AmerisourceBergen. 
Excluding certain items, adjusted earnings per share were 66 cents for the fiscal first quarter. 
Walgreens booked sales of $36.71 billion in the quarter, a roughly 10% jump from the same period a year ago. 
The company said revenue growth in its U.S. retail pharmacy and international business segments, and sales contributions from its U.S. health-care division, drove the increase. Walgreens is making significant investments to transform from a major drugstore chain to a large health-care company. 
Despite the quarterly beats, Walgreens reiterated its fiscal 2024 adjusted earnings guidance of $3.20 to $3.50 per share. 
Walgreens expects lower Covid-related sales, along with a higher tax rate and lower sale and leaseback contributions, to offset earnings growth. 
The company did not indicate in the earnings release whether it would also maintain its previous revenue guidance of $141 billion to $145 billion. 
Walgreens said during its quarterly earnings call in October that the company expects more than $1 billion in savings during fiscal 2024 due to its ongoing cost-cutting initiative, which involves closing unprofitable stores and using artificial intelligence to drive supply chain efficiencies, among other efforts.

Sales growth across pharmacy and health care

Walgreens’ U.S. retail pharmacy segment generated $28.94 billion in sales in the fiscal first quarter, an increase of more than 6% from the same period last year. Comparable sales at pharmacy locations rose 8.1%. 
That segment operates more than 8,000 drugstores across the U.S., which sell prescription and nonprescription drugs as well as health and wellness, beauty, personal care, and food products. 

A sign advertises Covid vaccine shots at a Walgreens Pharmacy in Somerville, Massachusetts, on Aug. 14, 2023.
Brian Snyder | Reuters

Pharmacy sales for the quarter rose 10.7% compared with the fiscal first quarter of 2023, as comparable sales climbed more than 13% due to price inflation in brand medications and “strong execution” in pharmacy services, Walgreens said. 
Total prescriptions filled in the quarter including immunizations totaled 311.6 million, which is flat compared with the same period a year ago. 
Walgreens cited a weaker respiratory virus season this fall, which is blunting demand for medications and vaccines. The company also pointed to Medicaid redeterminations, which are routine reviews each state’s Medicaid agency conducts to determine whether beneficiaries still qualify for coverage. 
Retail sales for the quarter fell 6.1% from the same period a year ago, and comparable retail sales declined 5%. Walgreens pointed to the weaker respiratory season as well as “macroeconomic-driven consumer trends” and Thanksgiving holiday store closures – a first for the company last year — to explain the decrease. 

More CNBC health coverage

Meanwhile, the company’s international segment, which operates more than 3,000 retail stores abroad,  racked up $5.83 billion in sales in the fiscal first quarter. That’s a rise of more than 12% from the same period a year ago. 
The company said sales from Walgreens’ U.K. subsidiary, Boots, grew more than 6%.
Revenue from Walgreens’ U.S. health-care segment came in at $1.93 billion, up from $989 million in the same period last year. 
That division includes primary-care provider VillageMD, which includes urgent-care provider Summit Health, and CareCentrix, which coordinates home care for patients after they’re discharged from the hospital. 
Walgreens will hold an earnings call with investors at 8:30 a.m. ET.
— CNBC’s Bertha Coombs and Robert Hum contributed to this report.
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State of Freight

To avoid attacks by Iran-backed Houthi militants based in Yemen, carriers have already diverted more than $200 billion in trade from the Red Sea.
The threat of violence in the key Middle Eastern trade route has already led to longer shipping times and higher freight costs.
Adding to the strain, about 20% of vessel capacity isn’t being used due to a massive drop in manufacturing orders, according to industry experts.

The Maersk Sentosa container ship sails southbound to exit the Suez Canal in Suez, Egypt, on Thursday, Dec. 21, 2023.
Stringer | Bloomberg | Getty Images

Attacks on ships in the Red Sea continue to push ocean freight rates higher, triggering warnings of inflation and delayed goods.
To avoid strikes by Iran-backed Houthi militants based in Yemen, carriers have already diverted more than $200 billion in trade over the past several weeks away from the crucial Middle East trade route, which, along with the Suez Canal, connects the Mediterranean Sea to the Indian Ocean.

This has created a multiple-front storm for global trade, according to logistics managers: Freight rates increasing daily, additional surcharges, longer shipping times, and the threat that spring and summer products will be late due to vessels arriving late in China as they travel the long way around South Africa’s Cape of Good Hope.
“The supply chain pressures that caused the ‘transitory’ part of inflation in 2022 may be about to return if the problems in the Red Sea and Indian Ocean continue,” said Larry Lindsey, chief executive of global economic advisory firm the Lindsey Group. The U.S. Federal Reserve and other central banks have been battling high inflation with rate increases, although it’s likely the Fed will start cutting rates soon.
“Neither the Fed nor the ECB can do anything about them and will likely ‘look through’ the inflation they cause, potentially leading to rate cuts despite somewhat heightened inflation pressures,” Lindsey said.

Arrows pointing outwards

The persistent violence against commercial ships drew a stern warning from the United States, Japan, the United Kingdom and nine other nations on Wednesday. “The Houthis will bear the responsibility of the consequences should they continue to threaten lives, the global economy, and free flow of commerce in the region’s critical waterways,” the countries said in a joint statement.
In the meantime, about 20% of vessel capacity isn’t being used due to a massive drop in manufacturing orders, according to industry experts. Instead, ocean carriers continue to cut their sailings while tight capacity and longer travel times are fueling rate increases.

Rates for freight traveling from Asia to northern Europe more than doubled this week to above $4,000 per 40-foot-equivalent unit (container). Asia-Mediterranean prices climbed to $5,175 per container. Some carriers have announced rates above $6,000 per 40-foot container for Mediterranean shipments starting mid-month, with surcharges ranging from $500 to $2,700 per container.

A cargo ship crosses the Suez Canal, one of the most critical human-made waterways, in Ismailia, Egypt on December 29, 2023. 
Fareed Kotb | Anadolu | Getty Images

“Given the sudden upward movement of ocean freight pricing, we should expect to see these higher costs trickle down the supply chain and impact consumers as we move through the first quarter,” said Alan Baer, CEO of shipping firm OL-USA. Companies, reflecting lessons they learned during the supply chain chaos of 2021-22, will adjust prices sooner rather than later, he added.
Rates from Asia to North America’s East Coast have risen by 55% to $3,900 per 40-foot container. West Coast prices climbed 63% to more than $2,700. More shippers are expected to start avoiding the East Coast and favor the West Coast ports. Likewise, rates are on track to rise again starting Jan. 15 due to previously announced increases.
“This is a big deal as it’s been mostly the fall in goods prices that have eased the inflation strain,” Peter Boockvar, investment chief at Bleakly Financial Group, told CNBC. “And while the battles going on in the Red Sea could end at any moment if the war in Gaza ends, it’s a reminder to the Fed that they can’t get complacent with their inflation fight if they don’t want to repeat the 1970s.”

The impact of longer routes

Diversions from Egypt’s Suez Canal, which feeds into the Red Sea, are hurting capacity. Rerouting vessels around the Cape of Good Hope adds two to four weeks to a round-trip voyage, according to Honour Lane Shipping (HLS). Ocean alliances need more ships on each Asia-East Coast route to maintain an efficient network schedule.
“Some 25%-30% of global container shipping volumes pass through the Suez Canal (mainly on Asia-Europe trade), and it is estimated that widespread re-routing around Africa could reduce effective global container shipping capacity by 10%-15%,” said the note. “While the disruption continues, carriers may have to reduce the number of port calls to offset the impact of longer routes.”

A grab from handout footage released by Yemen’s Huthi Ansarullah Media Centre on November 19, 2023, reportedly shows members of the rebel group during the capture of an Israel-linked cargo vessel at an undefined location in the Red Sea. Israeli ships are a “legitimate target”, Yemen’s Huthi rebels warned on November 20, a day after their seizure of the Galaxy Leader and its 25 international crew following an earlier threat to target Israeli shipping over the Israel-Hamas war. 
– | Afp | Getty Images

The longer travel time could also delay the arrival of spring goods that are traditionally picked up before the Chinese Lunar New Year, set for February, when factories close and employees go on vacation. Containers that were supposed to arrive on the East Coast in December are arriving now, according to logistics managers. Items include spring and summer clothing, pools, pool supplies, Easter products, patio furniture, and home and garden products.
North American East Coast ports in December, amid the Houthi attacks, “lost” several calls, which were instead pushed into January, according to data from maritime intelligence firm eeSEA. The vessels will instead arrive in January and February.
So vessels are not only late in dropping off their containers to their final destinations, they’re also late getting back to Asia to load containers. As a result, HLS is urging clients to book their container space four to five weeks in advance to secure a spot.
It’s reminiscent of what freight companies experienced during Covid’s earlier days.
“We used to book out four to six weeks out during Covid,” said OL-USA’s Baer. “During Covid, we had way too much cargo, and all the ships were full, so you have to forecast your bookings out. Now while there is vessel capacity, the vessels are late, so it’s a scramble to make sure you get your container on that vessel.”
Ocean carriers are also expanding land-freight services for those using West Coast ports intead of the East Coast. This is a similar strategy deployed by Hapag-Lloyd during Covid, when it offered clients service across land to the West Coast from the East Coast because it was faster.
These diversions in trade will create opportunities for West Coast railroad companies, Union Pacific and BNSF, a subsidiary of Berkshire Hathaway. The extra containers will also be a boost for trucking companies that also service those ports.
“Coming out of the holiday break we are seeing significant volumes being routed from Asia to the U.S. West Coast and via the Panama Canal to the U.S. East Coast to avoid the Suez Canal,” said Paul Brashier, vice president of drayage and intermodal at ITS Logistics. “We are forecasting this activity to increase as we get closer to the Lunar New Year peak season.” More

Ford Motor is increasing the price of some 2024 F-150 Lightning models, while lowering the costs of its most expensive models.
The new starting prices for the Ford F-150 Lightning will range from $54,995 for an entry-level Pro model to $92,995 for a Platinum Black trim.
The price adjustments come as EV companies attempt to balance slower-than-expected consumer demand with profits.

The Ford F-150 Lightning Electric Truck.
John Tlumacki | Boston Globe | Getty Images

DETROIT — Ford Motor is increasing the price of some 2024 F-150 Lightning models, while lowering the costs of its most expensive models.
The Detroit automaker confirmed Wednesday that new starting prices for the pickup will range from $54,995 for an entry-level Pro model to $92,995 for a Platinum Black trim. The models previously started at between $49,995 and $97,995 for the 2023 model.

The prices of the Platinum and Platinum Black models, with additional technologies and luxury amenities, were lowered by $5,000 and $7,000, respectively.
The price adjustments come as electric vehicle companies attempt to balance slower-than-expected consumer demand with profits. Ford has changed pricing on the Lightning as well as the all-electric Mustang Mach-E several times based on consumer demand and raw material costs.
Ford last month confirmed it would cut planned production of the F-150 Lightning roughly in half this year, marking a major reversal after the automaker significantly increased plant capacity for the EV in 2023.
“The F-150 Lightning is America’s best-selling electric pickup after a record fourth quarter, and demand continues to grow,” a Ford spokesperson said. “We are making adjustments to pricing, production and trim packages to achieve the optimal mix of sales growth, profitability and customer access to the IRA tax benefit.”
The price changes exclude a mandatory $2,095 destination fee as well as any federal or local incentives for purchasing an all-electric vehicle.

The F-150 Lightning is one of a limited number of vehicles that will maintain a $7,500 federal tax credit in accordance with more stringent requirements for assembly and materials for the vehicles and their batteries that took effect Jan. 1.
Sales of the F-150 Lightning have steadily increased in 2023, notching a monthly record of roughly 4,400 sold in November. The company has only sold 20,365 of the trucks this year through November, up 54% from a year earlier.
Ford is expected to report its December and year-end U.S. sales Thursday.Don’t miss these stories from CNBC PRO: More

General Motors’ U.S. vehicle sales increased 14.1% last year to represent the automaker’s best year since 2019.
GM’s sales are in line with expectations for overall industry sales.
The automaker’s annual sales increase was led by a 61% increase in its Buick brand, followed by a 13.1% increase for its mainstream Chevrolet unit.

The 2024 Buick Envista.

DETROIT — General Motors’ U.S. vehicle sales increased 14.1% last year to represent the automaker’s best year since 2019, prior to the effects of the Covid-19 pandemic and yearslong supply chain problems.
The Detroit automaker on Wednesday reported sales of roughly 2.6 million vehicles in 2023, including 625,176 cars and trucks sold during the fourth quarter, roughly flat compared to a year earlier.

The automaker sold about 2.3 million vehicles in 2022 and 2.9 million units in 2019.
GM’s sales are in line with expectations for overall industry sales. Edmunds expects industrywide sales to hit 15.5 million in 2023, which would be a roughly 14% increase compared to 2022.

GM said it expects total U.S. industry sales to hit 16 million in 2024. That would mark the highest industry sales since more than 17 million units in 2019 and the high end of industry analyst forecasts.
“GM has tremendous momentum. We grew our market share in 2023, maintaining strong pricing and low incentives,” Marissa West, GM’s senior vice president and president of North America, said in a release.
GM’s annual sales increase was led by a 61% increase in its Buick brand, followed by a 13.1% increase for its mainstream Chevrolet unit. Sales at the GMC and Cadillac brands were up roughly 9% each in 2023.

Sales of all-electric vehicles for GM were disappointing in 2023. GM’s EV sales totaled 75,883 units, or 2.9% of the company’s overall sales last year. A vast majority of those were sales of its now discontinued Chevrolet Bolt models.
The company has experienced problems in ramping up production of its newer “Ultium” EVs, including a major issue with battery module assembly.
To assist EV sales this year, the company expects to increase production of the vehicles and offer $7,500 in incentives on models that no longer qualify for up to $7,500 in federal tax credits due to new, more stringent requirements for assembly and materials for the vehicles and their batteries that took effect Jan. 1.
“We are committed to the future of EVs and will have the sales and marketing support to sell these ineligible vehicles. Beginning in January, GM will provide the equivalent EV tax credit purchase amount for any vehicles that became ineligible due to the new guidelines,” GM said in a statement.
As the auto industry continues to normalize from disruptions since the coronavirus pandemic, sales continue to vary by automaker. Here are other reported U.S. sales compared to 2022 totals:

Toyota Motor reported a 6.6% increase in sales for 2023, including a 25.5% increase in December. The company sold nearly 2.3 million vehicles last year.
Honda Motor reported a 33% uptick in sales last year to 1.3 million vehicles sold, including a 31.5% increase during the last month of the year.
Hyundai Motor’s sales increased 11% during 2023, including a 5% increase during the fourth quarter. The company sold more than 801,000 vehicles last year.
Nissan Group reported sales increased 23.2% to nearly 900,000 vehicles sold in 2023.
Kia reported record U.S. sales of 782,451 vehicles in 2023, up 13% year over year and 12% from its previous record in 2021.

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