Cari Gundee rides her Peloton exercise bike at her home on April 06, 2020 in San Anselmo, California.
Ezra Shaw | Getty Images
Peloton‘s CEO is promising anxious customers who are still waiting on their cycles and treadmills that the company is working fast to offer clearer answers on when those might arrive.
“We are determined to do what it takes to reduce our delivery times and to get certainty to customers on the delivery dates that we offer,” Chief Executive John Foley said during an earnings call Thursday. “We will continue making significant investments to get our products to the U.S. with more certainty and with greater speed.”
Demand for Peloton’s at-home fitness equipment has surged during the Covid pandemic. So much so, that Peloton hasn’t been able to keep up. It has also suffered as West Coast ports are seeing unloading times four-times longer than they were one year ago — a backlog that has hit a number of businesses, including other at-home fitness makers.
Peloton’s website currently says some items can take anywhere from eight to 10 weeks to be delivered. Previously, order-to-delivery windows were closer to four to six weeks. Some customers have reported having their deliveries delayed, a number of times, without being given a clear, updated at-home delivery window.
Foley explained Thursday that the company has more than doubled its customer support team over the past year, to help keep up with ac inquiries.
“We will continue to invest in systems, teams and manufacturing capabilities to ensure that we don’t disappoint our customers going forward,” he said. “We plan to get back to normal order-to-delivery [windows] way before the end of this calendar year. I would say in mid-to-late spring … we are going to be back in good shape before you know it.”
Peloton on Thursday reported fiscal second-quarter sales growth of 128%, marking its first billion-dollar quarter. In the wake of the higher sales, Peloton said it now expects full-year revenue to top $4 billion, up from prior forecast of more than $3.9 billion. Analysts had been calling for $3.95 billion.
The company kept its earnings outlook for fiscal 2021 unchanged, however. Additional investments in its supply chain to ease bottlenecks are expected to weigh on profits in the near term. Peloton announced Thursday it will be investing more than $100 million in air freight and expedited ocean freight over the next six months, to help speed deliveries.
It said its longer-term goal is to build a bigger stock of items in the United States. It’s in the process of acquiring the exercise equipment maker Precor, in a $420 million deal, to gain further manufacturing capabilities on its home turf.
Peloton shares were falling more than 8% in extended trading Thursday, having climbed more than 365% over the past 12 months.