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Peloton (PTON) founder and CEO John Foley has been spending the rather unusual COVID-19 months cooking up bacon and eggs with his two young children and wife (who is Peloton’s VP of apparel), dominating leaderboards on his snazzy new Bike+, and working closely with his executive team on protecting the company’s can-do culture amidst a nation of growing social unrest.
If he checks Peloton’s stock price on the Yahoo Finance app (though he didn’t say he does in our recent interview) we wouldn’t blame him — the stock has exploded close to 200% as the country has devoured Peloton’s digital-based bikes, treads and app content with gyms closed during the pandemic.
Amidst the daily grind of running a public company and being a dad and husband, Foley is remaining focused on achieving one of his biggest, long-term numerical goals for Peloton.
100 million Peloton users over 15 years.
“We call it a BHAG here — a big, hairy, audacious goal — of having 100 million members and a net promoter score of 100. To our knowledge, there's not a company in the world that has 100 net promoter score, and certainly 100 million subscribers gets us in that rarefied air of some of the FAANG [Facebook, Apple, Amazon, Netflix, Google] stocks. We think that Peloton has the opportunity to be one of those special companies, and we have thousands of people at Peloton who are marching in that direction every day and it doesn't look like we're slowing down anytime soon,” Foley tells Yahoo Finance.
Now to be fair, Peloton has a way to go in reaching that big hairy membership goal (the net promoter score is currently in the low 90s, impressive in its own right) and enjoying the profits associated with it. Peloton ended its most recent quarter with 3.1 million members. As for being on par with Netflix, the streaming giant wrapped up its second quarter with nearly 193 million global streaming memberships.
But Peloton’s most recent quarterly results — fueled by likely fundamental changes in how humans workout and approach their health more broadly — suggest Foley’s ‘BHAG’ goal may not be such a pipe-dream. Total members grew from 2.6 million in the preceding quarter to the aforementioned 3.1 million. Connected fitness subscription workouts surged 333% year-over-year to 76.8 million. The average subscriber pounded out 24.7 workouts in a month, up from 12 a year ago.
Numbers like this go a long way to dispel the idea that Peloton products are a nice to have for rich people, a thesis trumpeted by many analysts during the company’s 2019 IPO. Rather, the data suggests the pandemic has altered the total addressable market for Peloton.