A Peloton exercise bike for sale at the company’s showroom in Dedham, Massachusetts, USA, on Wednesday, February 3, 2021.
Adam Glanzman | Bloomberg | Getty Images
Peloton will expand its rental program nationally, the company said Tuesday.
The announcement came a day after Peloton revealed sweeping leadership changes, including the departure of co-founder, executive chairman and former CEO John Foley, as well as co-founder and chief legal officer Hisao Kushi.
The rental program began in test markets at Peloton’s physical store locations in Texas, Florida, Minnesota and Colorado. For $89 per month, customers can rent an original Peloton Bike and get a membership. There is an additional $150 setup fee. They can also opt for the Bike+ for $119 per month.
The rental program comes shortly after the company began selling certified pre-owned bikes and the announcement that Peloton would begin selling products on Amazon. The moves work to increase bike accessibility and attract new users to Peloton’s subscriber base.
They are part of CEO Barry McCarthy’s aggressive plan. He took over from Foley early this year after the company announced massive layoffs. Since then, a Netflix and Spotify veteran, McCarthy has pushed for a more subscriber-centric business model.
“I don’t see us as a hardware company. We’re a software company. We’re developing a great user experience,” McCarthy said Monday at the Goldman Sachs Communacopia and Technology conference.
He added: “A very small percentage of the monetary value that we collect from users, we collect when you buy a piece of hardware. The vast majority is the lifetime value that is collected month after, month after, month after month in the form of the $44 in subscription fee.”
Peloton’s shares closed about 10% amid broader market routine.