Company Quick10K Filing
Peloton Interactive
Price-0.00 EPS-1
Shares38 P/E0
MCap-0 P/FCF0
Net Debt-1,377 EBIT-50
TEV-1,377 TEV/EBIT28
TTM 2019-09-30, in MM, except price, ratios
10-Q 2020-12-31 Filed 2021-02-05
10-Q 2020-09-30 Filed 2020-11-06
10-K 2020-06-30 Filed 2020-09-11
10-Q 2020-03-31 Filed 2020-05-06
10-Q 2019-12-31 Filed 2020-02-06
10-Q 2019-09-30 Filed 2019-11-06
S-1 2019-08-27 Public Filing
8-K 2020-11-05
8-K 2020-09-16
8-K 2020-09-10
8-K 2020-09-08
8-K 2020-05-11
8-K 2020-05-06
8-K 2020-04-27
8-K 2020-02-05
8-K 2019-11-05

PTON 10Q Quarterly Report

Part I. Financial Information
Item 1. Financial Statements
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations
Item 3. Quantitative and Qualitative Disclosure About Market Risk
Item 4. Controls and Procedures
Part II. Other Information
Item 1. Legal Proceedings
Item 1A. Risk Factors
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds
Item 6. Exhibits
EX-31.1 q22020exhibit311.htm
EX-31.2 q22020exhibit312.htm
EX-32.1 q22020exhibit321.htm
EX-32.2 q22020exhibit322.htm

Peloton Interactive Earnings 2019-12-31

Balance SheetIncome StatementCash Flow
2.41.91.41.00.50.02018201820192020
Assets, Equity
0.30.20.10.1-0.0-0.12018201820192020
Rev, G Profit, Net Income
1.20.90.70.40.2-0.12018201820192020
Ops, Inv, Fin

pton-20191231
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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 10-Q
(Mark One)
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
For the quarterly period ended December 31, 2019
OR

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to
Commission File Number: 001-39058

Peloton Interactive, Inc.
(Exact name of registrant as specified in its charter)
Delaware
47-3533761
(State or other jurisdiction of
incorporation or organization)
(I.R.S. Employer
Identification No.)
125 West 25th Street, 11th Floor10001
New York, New York
(Zip Code)
(Address of principal executive offices)
(866679-9129
(Registrant's telephone number, including area code)

Securities registered pursuant to Section 12(b) of the Act:
Title of each classTrading Symbol(s)Name of each exchange on which registered
Class A common stock, $0.000025 par value per sharePTONThe Nasdaq Stock Market LLC

Indicate by check mark whether the registrant: (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934, as amended (Exchange Act) during the preceding 12 months (or for such shorter period that the registrant was required to file such reports); and (2) has been subject to such filing requirements for the past 90 days.  Yes    No    

Indicate by check mark whether the registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).     Yes     No   

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company, or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company,” and "emerging growth company" in Rule 12b-2 of the Exchange Act.
Large accelerated filer
Accelerated filer
Non-accelerated filer  
Smaller reporting company
Emerging growth company

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Act).     Yes       No  


As of January 31, 2020, the number of shares of the registrant's Class A common stock outstanding was 43,848,484 and the number of shares of the registrant's Class B common stock outstanding was 236,819,934.








TABLE OF CONTENTS
Page
Part I. Financial Information
Part II. Other Information




SPECIAL NOTE REGARDING FORWARD LOOKING STATEMENTS

This Quarterly Report on Form 10-Q contains forward-looking statements. All statements contained in this Quarterly Report on Form 10-Q other than statements of historical fact, including statements regarding our future operating results and financial position, our business strategy and plans, market growth, and our objectives for future operations, are forward-looking statements. The words “believe,” “may,” “will,” “estimate,” “potential,” “continue,” “anticipate,” “intend,” “expect,” “could,” “would,” “project,” “plan, “target,” and similar expressions are intended to identify forward-looking statements.

Forward-looking statements contained in this Quarterly Report on Form 10-Q include, but are not limited to, statements about:

 • our future financial performance, including our expectations regarding our revenue, cost of revenue, gross profit, Adjusted EBITDA, operating expenses including changes in sales and marketing, general and administrative expenses (including any components of the foregoing), and research and development, and our ability to achieve and maintain future profitability;

 • our business plan and our ability to effectively manage our growth;

 • anticipated trends, growth rates, and challenges in our business and in the markets in which we operate;

 • our international expansion plans and ability to continue to expand internationally;

 • market acceptance of our Connected Fitness Products and services;

 • beliefs and objectives for future operations;

 • our ability to increase sales of our Connected Fitness Products and services;

 • our ability to further penetrate our existing Subscriber base and maintain and expand our Subscriber base;

 • the effects of seasonal trends on our results of operations;

 • our expectations regarding content costs for past use;

 • our ability to maintain, protect, and enhance our intellectual property;

 • the effects of increased competition in our markets and our ability to compete effectively;

 • our ability to stay in compliance with laws and regulations that currently apply or become applicable to our business both in the United States and internationally; and

 • economic and industry trends, projected growth, or trend analysis.

We caution you that the foregoing list may not contain all of the forward-looking statements made in this Quarterly Report on Form 10-Q.

We have based these forward-looking statements largely on our current expectations and projections about future events and trends that we believe may affect our financial condition, results of operations, business strategy, short-term and long-term business operations and objectives, and financial needs. These forward-looking statements are subject to a number of risks, uncertainties, and assumptions, including those described in the section titled “Risk Factors” in Part II, Item 1A of this Quarterly Report on Form 10-Q. Moreover, we operate in a very competitive and rapidly changing environment. New risks emerge from time to time. It is not possible for our management to predict all risks, nor can we assess the impact of all factors on our business or the extent to which any factor, or combination of factors, may cause actual results to differ materially from those contained in any forward-looking statements we may make. In light of these risks, uncertainties, and assumptions, the future events and trends discussed in this Quarterly Report on Form 10-Q may not occur and actual results could differ materially and adversely from those anticipated or implied in the forward-looking statements.

You should not rely upon forward-looking statements as predictions of future events. The events and circumstances reflected in the forward-looking statements may not be achieved or occur. Although we believe that the expectations reflected in the forward-looking statements are reasonable, we cannot guarantee future results, performance, or achievements. We undertake no obligation to update any of these forward-looking statements for any reason after the date of this Quarterly Report on Form 10-Q or to conform these statements to actual results or revised expectations, except as required by law.

You should read this Quarterly Report on Form 10-Q and the documents that we reference in this Quarterly Report on Form 10-Q and have filed with the SEC with the understanding that our actual future results, performance, and events and circumstances may be materially different from what we expect.

In this Quarterly Report on Form 10-Q, the words "we," "us," "our" and "Peloton" refer to Peloton Interactive, Inc. and its wholly owned subsidiaries, unless the context requires otherwise.
3


PART I. FINANCIAL INFORMATION
Item 1. Financial Statements
PELOTON INTERACTIVE, INC.
CONDENSED CONSOLIDATED BALANCE SHEETS
(in millions, except share and per share amounts)

December 31,June 30,
20192019
(unaudited)
ASSETS
Current assets:
Cash and cash equivalents$532.8  $162.1  
Marketable securities
954.3  216.0  
Accounts receivable, net of allowances
22.0  18.5  
Inventories, net
243.6  136.6  
Prepaid expenses and other current assets
104.3  48.4  
Total current assets
1,857.1  581.7  
Property and equipment, net
159.1  249.7  
Intangible assets, net
17.0  19.5  
Goodwill
38.8  4.3  
Restricted cash
1.6  0.8  
Right-of-use asset492.1  —  
Other assets
18.5  8.5  
Total assets
$2,584.2  $864.5  
LIABILITIES, REDEEMABLE CONVERTIBLE PREFERRED STOCK, AND STOCKHOLDERS’ EQUITY (DEFICIT)
Current liabilities:
Accounts payable
182.5  92.2  
Accrued expenses
165.3  104.5  
Customer deposits and deferred revenue
159.6  90.8  
Other current liabilities
28.4  3.3  
Total current liabilities
535.8  290.8  
Deferred rent
—  23.7  
Build-to-suit liability
—  147.1  
Long term lease liability496.1  —  
Other non-current liabilities
7.1  0.4  
Total liabilities
1,039.0  462.0  
Commitments and contingencies (Note 10)
Redeemable convertible preferred stock, $0.000025 par value, zero and 215,443,468 shares authorized; zero and 210,640,629 shares issued and outstanding as of December 31, 2019 and June 30, 2019, respectively.
  941.1  
Stockholders’ equity (deficit)
Common stock, $0.000025 par value; 2,500,000,000 and zero Class A shares authorized, 43,794,644 and zero shares issued and outstanding as of December 31, 2019 and June 30, 2019, respectively; 2,500,000,000 and 400,000,000 Class B shares authorized, 236,819,934 and 25,301,604 shares issued and outstanding as of December 31, 2019 and June 30, 2019, respectively.
    
Additional paid-in capital
2,269.3  90.7  
Accumulated other comprehensive income3.3  0.2  
Accumulated deficit
(727.4) (629.5) 
Total stockholders’ equity (deficit)
1,545.2  (538.6) 
Total liabilities, redeemable convertible preferred stock, and stockholders’ equity (deficit)
$2,584.2  $864.5  
See accompanying notes to these unaudited condensed consolidated financial statements.

4

PELOTON INTERACTIVE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS
(unaudited)
(in millions, except share and per share amounts)
Three Months Ended December 31,Six Months Ended December 31,
2019201820192018
Revenue:
Connected Fitness Products
$381.1  $221.3  $538.7  $299.2  
Subscription
77.1  37.3  144.3  69.1  
Other
8.0  4.2  11.3  6.7  
Total revenue
466.3  262.9  694.3  375.0  
Cost of revenue:
Connected Fitness Products
226.7  126.5  316.5  168.8  
Subscription
32.4  20.3  61.9  36.6  
Other
10.0  4.6  13.6  6.7  
Total cost of revenue
269.1  151.5  392.1  212.1  
Gross profit
197.1  111.3  302.2  162.9  
Operating expenses:
Sales and marketing
160.5  99.5  238.1  145.0  
General and administrative
77.5  55.4  138.5  105.4  
Research and development
20.7  12.4  38.1  24.0  
Total operating expenses
258.7  167.3  414.6  274.4  
Loss from operations
(61.5) (56.0) (112.4) (111.5) 
Other income, net:
Interest income, net
5.9  1.2  7.1  2.2  
Other expense, net
(0.1) (0.3) (0.2) (0.3) 
Total other income, net
5.7  0.9  6.9  1.9  
Loss before provision for income taxes
(55.8) (55.1) (105.5) (109.6) 
Income tax benefit
(0.4)   (0.4)   
Net loss
$(55.4) $(55.1) $(105.2) $(109.6) 
Net loss attributable to Class A and Class B common stockholders$(55.4) $(105.2) $(105.2) $(159.7) 
Net loss per share attributable to Class A and Class B common stockholders, basic and diluted$(0.20) $(4.83) $(0.66) $(6.83) 
Weighted-average Class A and Class B common shares outstanding, basic and diluted279,974,823  21,780,927  159,214,343  23,390,001  
Other comprehensive income:
Change in unrealized gain (loss) on marketable securities$(0.2) $  $(0.2) $  
Change in foreign currency translation adjustment4.7  0.7  3.4  0.6  
Total other comprehensive income4.5  0.7  3.1  0.6  
Comprehensive loss$(50.9) $(54.4) $(102.0) $(109.0) 

See accompanying notes to these unaudited condensed consolidated financial statements.

5

PELOTON INTERACTIVE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS
(unaudited)
(in millions)

Six Months Ended December 31,
20192018
Cash Flows from Operating Activities:
Net loss$(105.2) $(109.6) 
Adjustments to reconcile net loss to net cash used in operating activities:
Depreciation and amortization expense17.2  9.2  
Stock-based compensation expense35.8  68.5  
Impairment of long-lived assets(0.2)   
Amortization of debt issuance costs0.2  0.2  
Amortization of premium from marketable securities(0.5)   
Non-cash operating lease expense21.4  —  
Changes in operating assets and liabilities:
Accounts receivable23.8  (17.4) 
Inventories(94.2) (82.1) 
Prepaid expenses and other current assets(12.5) (21.1) 
Other assets(8.1) (5.5) 
Accounts payable and accrued expenses98.0  122.1  
Customer deposits and deferred revenue68.3  50.0  
Operating lease liabilities, net(17.5) —  
Other liabilities6.7  6.4  
Net cash provided by operating activities33.2  20.7  
Cash Flows from Investing Activities:
Purchases of marketable securities(973.1)   
Maturities of marketable securities141.5    
Sales of marketable securities55.4    
Acquisition of business, net of cash acquired(45.9) (0.1) 
Purchases of property and equipment(48.8) (25.9) 
Net cash used in investing activities(870.8) (25.9) 
Cash Flows from Financing Activities:
Proceeds from issuance of common stock upon initial public offering, net of offering costs1,195.7    
Repurchase of common and convertible preferred stock, including issuance costs  (130.3) 
Proceeds from issuance of redeemable convertible preferred stock, net of issuance costs  539.1  
Proceeds from employee stock purchase plan withholdings2.0    
Proceeds from exercise of stock options4.2  1.6  
Net cash provided by financing activities1,201.9  410.5  
Effect of exchange rate changes7.1  0.6  
Net change in cash371.4  405.8  
Cash, cash equivalents and restricted cash — Beginning of period163.0  151.6  
Cash, cash equivalents and restricted cash — End of period$534.4  $557.5  
Supplemental Disclosures of Cash Flow Information:
Cash paid for interest$  $0.4  
Supplemental Disclosures of Non-Cash Investing and Financing Information:
Conversion of convertible preferred stock to common stock$941.1  $  
Property and equipment accrued but unpaid$7.7  $1.6  
Building - build-to-suit asset$  $112.9  
Stock-based compensation capitalized for software development costs$0.9  $0.2  
See accompanying notes to these unaudited condensed consolidated financial statements.

6

PELOTON INTERACTIVE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY (DEFICIT)
(unaudited)
(in millions)
Redeemable Convertible
Preferred Stock
Class A and Class B Common StockAdditional Paid-In CapitalOther Comprehensive IncomeAccumulated DeficitTotal Stockholders’ Equity (Deficit)
SharesAmountSharesAmount
Balance – September 30, 2018
214.4  $945.4  26.1  $  $22.0  $(0.1) $(390.6) $(368.7) 
Repurchase of common and redeemable preferred stock(3.8) (4.3) (4.8) —  —  —  (97.8) (97.8) 
Exercise of stock options—  —  0.8  —  1.6  —  —  1.6  
Stock-based compensation expense—  —  —  —  39.7  —  —  39.7  
Other comprehensive income—  —  —  —  —  0.7  —  0.7  
Net loss—  —  —  —  —  —  (55.1) (55.1) 
Balance – December 31, 2018
210.6  $941.1  22.1  $  $63.3  $0.6  $(543.5) $(479.5) 
Balance – September 30, 2019
  $  280.3  $—  $2,249.1  $(1.1) $(672.0) $1,576.0  
Exercise of stock options—  —  0.3  —  2.6  —  —  2.6  
Stock-based compensation expense—  —  —  —  17.6  —  —  17.6  
Other comprehensive income—  —  —  —  —  4.5  —  4.5  
Net loss—  —  —  —  —  —  (55.4) (55.4) 
Balance – December 31, 2019
  $  280.6  $  $2,269.3  $3.3  $(727.4) $1,545.2  

See accompanying notes to these unaudited condensed consolidated financial statements.




7

PELOTON INTERACTIVE, INC.
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN REDEEMABLE CONVERTIBLE PREFERRED STOCK AND STOCKHOLDERS’ EQUITY (DEFICIT)
(unaudited)
(in millions)
Redeemable Convertible
Preferred Stock
Class A and Class B Common StockAdditional Paid-In CapitalOther Comprehensive IncomeAccumulated DeficitTotal Stockholders’ Equity (Deficit)
SharesAmountSharesAmount
Balance – June 30, 2018
176.3  $406.3  25.9  $  $20.5  $  $(336.1) $(315.6) 
Issuance of Series F redeemable convertible preferred stock, net38.1  539.1  —  —  —  —  —  —  
Repurchase of common and preferred stock(3.8) (4.3) (4.8) —  —  —  (97.8) (97.8) 
Exercise of stock options—  —  1.0  —  2.4  —  —  2.4  
Stock-based compensation expense—  —  —  —  40.5  —  —  40.5  
Other comprehensive income—  —  —  —  —  0.6  —  0.6  
Net loss—  —  —  —  —  —  (109.6) (109.6) 
Balance – December 31, 2018
210.6  $941.1  22.1  $  $63.3  $0.6  $(543.5) $(479.5) 
Balance – June 30, 2019
210.6  $941.1  25.3  $  $90.7  $0.2  $(629.5) $(538.6) 
Initial public offering, net of issuance costs of $6.3 million
—  —  43.4  —  1,195.7  —  —  1,195.7  
Conversion of redeemable convertible preferred stock to common stock(210.6) (941.1) 210.6  —  941.1  —  —  941.1  
Exercise of stock options—  —  1.0  —  5.1  —  —  5.1  
Exercise of stock warrants—  —  0.2  —  —  —  —  —  
Stock-based compensation expense—  —  —  —  36.7  —  —  36.7  
Other comprehensive income—  —  —  —  —  3.1  —  3.1  
Net loss—  —  —  —  —  —  (105.2) (105.2) 
Cumulative effect adjustment in connection with adoption of ASU 2016-02—  —  —  —  —  —  7.2  7.2  
Balance – December 31, 2019
  $  280.6  $  $2,269.3  $3.3  $(727.4) $1,545.2