Peloton’s stock of treadmills and bikes has been badly hit by Brexit and global shipping congestion, leading to severe delays, according to company CEO John Foley.
On Peloton’s website, some items can take eight to ten weeks to be delivered, higher than the four to six week delivery windows earlier this year.
The company has struggled to keep up with demands for months, leading to long wait times, Foley said.
UK demand for Peloton’s at-home fitness equipment has surged due to recurrent lockdowns and gym closures leading people to look for new ways of exercising, he added.
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Peloton ramped up its manufacturing capacity more than six-fold in the last 12 months, but Foley said that “unfortunately, dramatically scaling our manufacturing capacity alone has not gotten us out of the woods.”
A global increase in shipping traffic has added significant delays, pointing to port congestion in Los Angeles and Long Beach, where shipping container volume has doubled in the last 12 months.
“Effective immediately, we are investing over $100m to help expedite the movement of Bikes and Treads globally, in order to meet our delivery commitments,” Foley said.
“On average, in the coming months, we will be incurring a transportation and delivery cost that is over ten times our usual cost per Bike and Tread, including, in many cases, shipping them by air instead of by sea.
“We are making this investment because we are as frustrated as you are that you don’t have your Peloton Bike or Tread yet.”
Peloton revenues last quarter grew 128 per cent to $1.06bn, higher than originally forecast at $1.03bn.
Its net profit was $63.6m, compared to a loss of $55.4m one yar ago. Peloton stock has also risen 383 per cent in the last twelve months, giving the company a valuation of $46bn.
In late December, Peloton announced it would acquire Precor, one of the world’s biggest fitness equipment makers, for $420m, expanding manufacturing capacity for Peloton products.