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Apple Floated as Potential Buyer of Peloton

People here are greatly underestimating the potential benefits to Apple. Peloton's hardware offerings would be a new and nearly unbeatable addition to Apple (remember, in addition to Peloton-branded products, Peloton also owns Precor). All of those could be linked to the Apple Watch/Apple Fitness in ways that would give those platforms a tremendous edge. Peloton's core user base (of which I am one) is extremely satisfied with the product/service and loyal (for example, Peloton is aware of a large number of its users who have held off on buying a rowing machine because they are waiting on an offering from Peloton, even though the market has some excellent rowing machine options). Peloton users are highly likely to buy extras, such as apparel, from the company. Imagine, for example, the potential appeal of watch bands with the Peloton logo. The software design is Apple-esque. The class offerings (and software front-end) are easily portable to different hardware. Some of Peloton's products already incorporate Apple GymKit modules. And Apple could improve on the Peloton experience in one key way -- by connecting off-equipment metrics to on-equipment metrics via the Apple Watch.

If Apple is serious about fitness, it needs equipment. This would be a very easy way to get that, and the incredible Peloton service and instructors would be a really nice bonus. Apple should do this.
 
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jlchereau said:
Why would Apple want to sell bikes and treadmills? That is low margin and expensive to support. They are much better off partnering.
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It would make sense IMHO for Apple to pickup Peloton. Especially at their current state which would effectively represent a significant discount on their previous valuation (stock is down over 80% YoY).

Although fitness equipment is traditionally low margin Peloton has managed to sell them at significant markup. Apple already has an established fitness business with Apple Fitness+. This would allow them to expand the hardware offerings beyond the Apple Watch and Apple TV/iOS by offering equipment that has a deeper tie into Apple Fitness+.

Doesn’t mean Apple will bite, but this deal could make a lot of sense. The biggest challenge for Apple would be making sure they don’t increase the monopoly scrutiny they have been under lately…
 
iBluetooth said:
Largest acqusition of Apple was $3 billion for Beats! That's why this story is pointless, as it is now at $8 billion, thanks to this story. Apple doesn't acquire overpriced companies, but likes to buy smaller startups with good ideas, before they exploit. This story is just some large investor trying to talk up Peloton's stock. I am sorry for them, but they had quite a journey and Kathy Woods really promoting them.
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Apple didn't buy Beats for their business. They bought Beats to get Jimmy Iovine and Dr. Dre into the company. The headphones and hardware was secondary. There was a decently sized user base for Beats hardware, but once Apple brought the brand in-house, they changed the hardware to be more central, rather than bass-heavy.

Does Peleton have a Jimmy Iovine that Apple wants? Do they have a Dr. Dre? I don't know. Perhaps Peleton's subscribed user base is what Apple wants. People who can afford a $2500 spin bike and then a costly subscription on top is a good customer to have. They've proven that they spend money. I wonder what the overlap between Peleton users and Apple users. I imagine the Venn diagram to have very high convergence. Would there be value in further consolidating those users that are already Peleton and Apple users? Would the (I'm guessing) small amount of Peleton/Android users be worth chasing?
 
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This is so stupid. As dumb as the analyst who claimed that because Apple didn’t buy a movie studio it must mean the company is going after sports. Why would Apple want to own a company that makes pricey equipment people don’t want to buy? Especially now as we’re coming out of the pandemic and more people are back at the gym?
 
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I couldn’t see Apple buying peloton as Apple has already built half of what peloton has ie the instructors/coaching side of it.

And Apple would inherit the various lawsuits.

Also as someone else on this thread has mentioned, I’m not sure if peloton is as big in the rest of the world as it is in the USA

(no one outside of the USA has Apple [edit: Apple Cash via iMessage] or Apple Card either!).

I could see Google or Facebook buying it though, as they need to play catch up here.
 
i just use the treadmills at my gym - paid for a membership might as well use it - never used peleton but seen way too many recent ads for them - now the stock is head slammed - ads are a bad way to gauge company stock performance - bottom line is what counts - as for aapl aquisition potential - i wouldnt do it
 
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laptech said:
Peloton were doing good in my opinion until it all went down hill when a parent let their child get too close to one of it's treadmills and it got caught up in the treadmill. The aftermath of that event occuring had been a social media backlash of people wanting to find things wrong with Peloton which resulted in orders being cancelled and bad reviews of it's products. There is no way Peloton was going to survive and they haven't.
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Great. Blame the victim here. The Peleton treadmill was a flawed design that didn't build on the decades of safety design that the industry learned. They made a dangerous treadmill that looked cool and basically said "F safety. A rear guard looks dumb. Let's get rid of it."
 
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jlchereau said:
Why would Apple want to sell bikes and treadmills? That is low margin and expensive to support. They are much better off partnering.
Click to expand...
BF1M said:
Compared to cars which are super cheap to maintain…
Click to expand...
The total addressable market for cars is much larger than for exercise equipment.

One is in the billions. The other is in the trillions.
 
Apple won’t buy them for the same reason they ended up not making TV sets - slow churn. People don’t upgrade their bikes every 2-4 years like they do with other Apple gear.

It’s a market with a ceiling that’s probably already been hit.

Unless Apple comes in and makes a unicycle called Peloton mini …
 
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bluespark said:
People here are greatly underestimating the potential benefits to Apple. Peloton's hardware offerings would be a new and nearly unbeatable addition to Apple (remember, in addition to Peloton-branded products, Peloton also owns Precor). All of those could be linked to the Apple Watch/Apple Fitness in ways that would give those platforms a tremendous edge. Peloton's core user base (of which I am one) is extremely satisfied with the product/service and loyal (for example, Peloton is aware of a large number of its users who have held off on buying a rowing machine because they are waiting on an offering from Peloton, even though the market has some excellent rowing machine options). Peloton users are highly likely to buy extras, such as apparel, from the company. Imagine, for example, the potential appeal of watch bands with the Peloton logo. The software design is Apple-esque. The class offerings (and software front-end) are easily portable to different hardware. Some of Peloton's products already incorporate Apple GymKit modules. And Apple could improve on the Peloton experience in one key way -- by connecting off-equipment metrics to on-equipment metrics via the Apple Watch.

If Apple is serious about fitness, it needs equipment. This would be a very easy way to get that, and the incredible Peloton service and instructors would be a really nice bonus. Apple should do this.
Click to expand...
Agreed. The Peloton brand is basically the Apple of fitness equipment right now. They are high end and have a fanatical user base. The Peloton management team has been pretty poor between the commercial, how they handle the Tread issues, and not planning for a demand slowdown.

Important to note that Peloton isn't really competing with road bikes, their primary competition pre-COVID was spin studios that charge $20+/class. In that space, they were a bargain. With 0% financing a person could get a Peloton plus sub for $100/month. The $40 sub also works for the whole family.

Something else non-Peloton users miss is that the community is sticky. People ride with and compete against friends and groups. Some might argue, it's a non-toxic, decently functioning social network.

If Apple wants to be serious about fitness, they need better a hardware story. Apples whole proposition is how everything Apple functions better together. Apple will probably not buy Peloton, but they should do something - either buy or partner with an equipment maker.
 
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bluespark said:
People here are greatly underestimating the potential benefits to Apple. Peloton's hardware offerings would be a new and nearly unbeatable addition to Apple (remember, in addition to Peloton-branded products, Peloton also owns Precor). All of those could be linked to the Apple Watch/Apple Fitness in ways that would give those platforms a tremendous edge. Peloton's core user base (of which I am one) is extremely satisfied with the product/service and loyal (for example, Peloton is aware of a large number of its users who have held off on buying a rowing machine because they are waiting on an offering from Peloton, even though the market has some excellent rowing machine options). Peloton users are highly likely to buy extras, such as apparel, from the company. Imagine, for example, the potential appeal of watch bands with the Peloton logo. The software design is Apple-esque. The class offerings (and software front-end) are easily portable to different hardware. Some of Peloton's products already incorporate Apple GymKit modules. And Apple could improve on the Peloton experience in one key way -- by connecting off-equipment metrics to on-equipment metrics via the Apple Watch.

If Apple is serious about fitness, it needs equipment. This would be a very easy way to get that, and the incredible Peloton service and instructors would be a really nice bonus. Apple should do this.
Click to expand...
Except this entire situation reeks of a market that’s just not there (luxury stationary bikes). Sounds more like you’re trying to justify your purchase than thinking about the mass market as a whole.
 
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ELman said:
Have fun with that at 5AM in the dark when the temperature is -10F
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jmgregory1 said:
Right?
Click to expand...
Wrong.

You can still ride the bike indoors with an indoor trainer.

trainre.png
 
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ftaok said:
Apple didn't buy Beats for their business. They bought Beats to get Jimmy Iovine and Dr. Dre into the company. The headphones and hardware was secondary. There was a decently sized user base for Beats hardware, but once Apple brought the brand in-house, they changed the hardware to be more central, rather than bass-heavy.

Does Peleton have a Jimmy Iovine that Apple wants? Do they have a Dr. Dre? I don't know. Perhaps Peleton's subscribed user base is what Apple wants. People who can afford a $2500 spin bike and then a costly subscription on top is a good customer to have. They've proven that they spend money. I wonder what the overlap between Peleton users and Apple users. I imagine the Venn diagram to have very high convergence. Would there be value in further consolidating those users that are already Peleton and Apple users? Would the (I'm guessing) small amount of Peleton/Android users be worth chasing?
Click to expand...
Apple acquired Beats for them and also to get the products that are really selling. They have totally made up for the acquisition just by the products. But, I mentioned this, as this acquisition is so far away of what Apple does. They don't need a customer list. They already have plenty of high worth customers with many Apple products in their households. Those that are using Android, hate Apple and thus, are not really potential customers.
But the biggest headache would be the accidents and deaths that Peloton will be facing in lawsuits, would any company wan't to take those brand killing news stories onto them? For Apple the brand destruction cost is much higher than the value of the know how or the products.
 
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bluespark said:
People here are greatly underestimating the potential benefits to Apple. Peloton's hardware offerings would be a new and nearly unbeatable addition to Apple (remember, in addition to Peloton-branded products, Peloton also owns Precor). All of those could be linked to the Apple Watch/Apple Fitness in ways that would give those platforms a tremendous edge. Peloton's core user base (of which I am one) is extremely satisfied with the product/service and loyal (for example, Peloton is aware of a large number of its users who have held off on buying a rowing machine because they are waiting on an offering from Peloton, even though the market has some excellent rowing machine options). Peloton users are highly likely to buy extras, such as apparel, from the company. Imagine, for example, the potential appeal of watch bands with the Peloton logo. The software design is Apple-esque. The class offerings (and software front-end) are easily portable to different hardware. Some of Peloton's products already incorporate Apple GymKit modules. And Apple could improve on the Peloton experience in one key way -- by connecting off-equipment metrics to on-equipment metrics via the Apple Watch.

If Apple is serious about fitness, it needs equipment. This would be a very easy way to get that, and the incredible Peloton service and instructors would be a really nice bonus. Apple should do this.
Click to expand...
The biggest headache would be the accidents and deaths that Peloton is facing in lawsuits, would any company wan't to take those brand killing news stories onto them? For Apple the brand destruction cost, would be much higher than the value of the know-how or the products.
 
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Here's the million dollar question for you armchair CEO's...how is Peloton's business model so different from Apple's?

They both sell expensive hardware, provide a good user experience, have a loyal and passionate community and sell fitness services via subscription.

Sure monthly fees are on the high side, but I understand you didn't have to buy hardware to use. Did Apple Fitness+ play a role in it's downfall? Or purely mismanagement and over estimating demand?
 
sw1tcher said:
The total addressable market for cars is much larger than for exercise equipment.

One is in the billions. The other is in the trillions.
Click to expand...

I fail to see your point and find your numbers suspect as well. Latest numbers have EV around what? 3% market share? Does that equal even half a trillion? Doubt it.
 
Let’s see.
1. Their products killed people and then refused to do a recall.
2. They claimed that veterinarians are not doctors.
3. CEO thew a COVID party after the stock dropped 11%.

Couldn’t happen to a better group.
 
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