Peloton’s no-good-very-bad downfall from its pandemic peak — dropping over $20 billion in worth since November and changing into a harmful subplot in prime time TV — has attracted hypothesis that the linked health firm is a goal to be acquired, however by whom? A Friday night report from the Wall Avenue Journal tosses out Amazon as one of many “potential suitors” which may be contemplating a deal — simply as markets closed for the weekend and only some days earlier than Peloton points its Q2 2022 earnings report on February eighth. Simply the suggestion brought about a spike in Peloton’s inventory value, sending it up 20–30 % in after-hours buying and selling.
Peloton’s yo-yoing fortunes over the past two years have been effectively documented, however mix the deep-pocketed tech giants making an attempt to boost their well being and health portfolios and the fact of re-opening gyms, there are some dots to attach. Over the previous few weeks, some experiences have prompt Apple as a doable touchdown spot, however that appears unlikely. Apple’s well being strategy makes use of the Watch first, then connects companies to any health gear its clients favor to make use of, not high-priced workout-specific {hardware} that may be changed by a less expensive bike and BYO pill.
Amazon makes a bit of extra sense as a vacation spot, even when it’s solely a bit of extra. There was an almost-launch of a Peloton-like “Prime Bike” in 2020 that I nonetheless can’t work out, plus two makes an attempt at fitness-tracking wristwear of its personal with the Halo Band in 2020 and Halo View in December. Shelling out double-digit billions — a purchase order may value one thing close to the $13.7 billion Amazon spent to amass Complete Meals — on Peloton could be an costly however efficient method to meet up with the health/well being sector competitors.
In response to the WSJ, Amazon is working with advisors to think about its subsequent transfer. Whether or not an acquisition try comes from the corporate or anybody else remains to be up within the air. Additionally muddying the state of affairs, based on the paper, is that CEO John Foley and different insiders management 80 % of Peloton’s voting shares, so activist investor requires a sale could not carry a lot weight. Both approach, we’ll in all probability have a greater thought of the corporate’s future by the point its earnings report hits on Tuesday afternoon.
Supply: The Verge
