After enjoying a lockdown-fuelled peak during the pandemic, Peloton is now spinning out of control. Product recalls, plummeting stock prices, a major decline in demand and its bike’s dangerous cameos in not one, but two primetime TV shows have wiped roughly $US40 ($56) billion from its market value in the last year.
Now, corporations are reportedly lining up to bid on the beleaguered exercise equipment manufacturer, with Amazon being the latest among several “potential suitors” to throw its hat in the ring, the Wall Street Journal reported Friday.
According to people familiar with the matter that spoke with the outlet, Amazon has been talking to advisers about a potential acquisition. Additionally, Nike is evaluating the idea of making an offer, the Financial Times reports, though these considerations are in the preliminary stages and it has not yet spoken with Peloton. Several experts have floated Apple as a possible buyer for Peloton, but that also remains speculation.
Peloton hasn’t initiated a formal sales process at this time, but there has been ample interest from outsiders about acquiring the company, a person familiar with the talks told CNBC. Its share prices shot up by around 30% on Friday after the news broke that Amazon might be eyeing it.
Nike and Amazon did not immediately return Gizmodo’s request for comment. We’ll update this article with their response.
It’s not immediately clear how Amazon or Nike might incorporate Peloton’s technology or user base into their respective business models. A stronger argument can be made for the e-commerce giant though, as noted by the Journal. For one thing, Amazon’s logistics arm would be a serious boon amid Peloton’s ongoing supply chain issues. Not to mention that Amazon has a history of investing heavily in the health and wellness industry: It already has its own line of fitness bands, the Halo Band launched in 2020 and the Halo View that debuted in December, and scooped up Whole Foods for more than $US13 ($18) billion in 2017.
Peloton’s existing subscription service could potentially be bundled with Amazon’s Prime membership program as well, something Amazon has done before with its previous acquisitions to pile on incentives for shoppers to sign up.
If Amazon does go through with the sale, Peloton’s offerings would become some of the most expensive hardware in its catalogue. After Peloton hiked up delivery fees for some of its equipment earlier this year, the all-in price of its original stationary bike now stands at $US1,745 ($2,422) while its treadmill retails for $US2,845 ($3,949).