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Peloton stock hits all-time low, partners with Dick's Sporting Goods to sell equipment

Peloton shares hit a record-low since its IPO and consider branching out distribution of its fitness equipment through retail markets such as Amazon or Dick's Sports Goods.

Video transcript

SEANA SMITH: Let's talk about another huge mover to the downside today, and that's Peloton. Shares getting hit pretty hard, off just over 15%, hitting a new all-time low. Now, despite an effort to reach more customers, the struggling company announcing earlier that it will start selling its bikes and treadmills at Dick's Sporting Goods. It's the first time people are going to be able to purchase the Peloton equipment at brick and mortar stores outside of their own stores. Until now, it was a direct-to-consumer brand. And in August, Peloton started selling its products on Amazon.

Now, the goal here is to have Peloton products in 100 Dick's locations by the holidays. Dave, I know you and I have talked about Peloton many times, and Rachelle, too, in the past. When you take a look at the fact that the company has been struggling for so long, they haven't reached these types of retail partnerships that I think make a lot of sense for the company.

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They're struggling to grow their customer base. They need to get out in front of maybe consumers that aren't seeing their ads, that aren't-- that don't have friends who have Peloton, so they're not so much in touch with the new developments that are happening on this platform. I think a deal like this, Dave, makes sense. And I'm sure we are going to see more of these types of deals down the line.

DAVE BRIGGS: Yeah, I think this one differs for me than Apple. I mean, this is-- you got to give Barry McCarthy, their new CEO, credit. He is going with the kitchen sink approach. I mean, he has been throwing everything he's got at this problem, including outsourcing their manufacturing. He's got the partnership with Amazon. And now he's got this with Dick's Sporting Goods, minus the rowing machine. That will not be in Dick's.

But 100 stores by the holidays, minimal at best. We're talking about a stock that's down 14.8% today, and on the year, down 91% year to date. I just don't see the comeback story for Peloton, unless, of course, they are purchased by somebody, and everyone seems to think nobody would buy Peloton right now. I don't know. A bit bearish on this one, Rachelle.

RACHELLE AKUFFO: No, I mean, I agree. I mean, obviously, the spending that people did on some of this athletic equipment, you only need the one Peloton. Like, how many Pelotons are you going to put in your space? And obviously, when they then went to Amazon, they're competing with some of these other companies that are also selling treadmills, rowing machines on there.

And now with Dick's Sporting Goods, I'm not sure they're going to be getting more people. It might be a better place if they focus, perhaps, on their subscription services, perhaps with classes people can do at home, and sort of integrate in other ways. In terms of the hardware, though, I do think that's still going to be an uphill battle for Peloton, unfortunately.

SEANA SMITH: Yeah, but I think it is, though, a step in the right direction, right? They're getting their bikes in front of people that maybe haven't-- that obviously have not bought them yet, or they wouldn't be buying another one, most likely, unless maybe you have two homes or a reason to buy a second one. Maybe some people do.

But I think it is a step in the right direction. I think Peloton does need to change direction. Clearly, what they have been doing over the last 18 months hasn't been working, especially for the Street. We've seen the crash since the all-time high in the stock. I know you're not buying it. Maybe someone will come in and buy this company. But I do think this partnership with Dick's does make a lot of sense.

DAVE BRIGGS: It's a step in the right direction, albeit in an inflationary, recessionary type of environment.

SEANA SMITH: So maybe--

DAVE BRIGGS: The timing is all against Peloton right now.

SEANA SMITH: --we could debate how big of a step it is, how big of a signal step.

DAVE BRIGGS: Yes, fair enough, Rachelle.

RACHELLE AKUFFO: If you have the extra income in this environment, maybe, but not a lot of people do.