Peloton stock trends up amid declining year-over-year sales figures

Yahoo Finance Live checks out Peloton shares after the exercise equipment brand reported a significant drop in sales.

Video Transcript

[AUDIO LOGO]

SEANA SMITH: All right, my play today is Peloton. Shares turning positive after dropping as much as 16%, following a wider-than-expected loss and offering weak guidance for its holiday quarter. The company also warning that a challenging macroeconomic environment could affect its goal of achieving break-even cash flow this fiscal year.

Despite these challenges, though, comments from CEO Barry McCarthy, I think, helped maybe reassure some investors out there. McCarthy saying, that Peloton was making, quote, "significant progress" in its turnaround plan. And he's confident in the direction of this company.

I think, Pras, it's interesting to me to see that the extent of the gains that we are right now. We're just about half an hour to go in the trading day. But we know that Peloton has taken a number of steps.

They've made a couple of rounds of layoffs. They've reduced the price of their bike. They've also announced some other strategic changes. It hasn't yet been reflected in the results. But maybe investors are saying, at $9.00 a share, they're getting a little bit more positive on the name. I don't know.

PRAS SUBRAMANIAN: You know, I think-- I mean, there's definitely some value there. It's a great product, great service. Now, if they could sell me another room to attach to my apartment so I can put the bike in there.

SEANA SMITH: [LAUGHS] Yeah.

PRAS SUBRAMANIAN: 'Cos I can't fit the bike in there. But you know, I think it's-- like I said, there's value there. That IP is worth something. And I think we're seeing that in that-- I was surprised that bounce is pretty big, pretty significant. So I guess they liked what Barry McCaffrey-- McCaffrey?

SEANA SMITH: McCarthy. And I also think-- no, it was close. It was close. Not far. I know hard to keep everyone's name straight these days.

But I also think it's gonna be interesting because this name has been floated as a potential takeover target by a comp-- there's been names floated out there. It could maybe-- it could be an Amazon play. Maybe someone like Samsung could come in and buy Peloton.

But I don't know, I don't know how this is all going to shake out. Because the slowdown that we've seen in the personal fitness product space, certainly has not turned a corner, at least as of yet.

PRAS SUBRAMANIAN: You know, you saw Google get-- buy Fitbit many years ago. And I always thought the Holy Grail would be Apple buying Peloton, right? That would be just amazing--

SEANA SMITH: That would be.

PRAS SUBRAMANIAN: --thinking of all the Apple Watch. The Apple--

SEANA SMITH: That would be very convenient for me as a user of both products, getting them all under one roof.

PRAS SUBRAMANIAN: I agree. And I'm with you on that. And maybe-- you know, maybe Tesla might buy them. But I don't know.

SEANA SMITH: You never know.