What do you do when you amass millions of paying subscribers, sell $2,700 ($2,245 if you just want the bike for one rider) exercise bikes direct, have implied endorsements from Michelle Obama and Hugh Jackman, and an early valuation of $4 billion in the red-hot fitness space? You go public, of course.

At least that's what Peloton is supposed to be doing. The "weirdly profitable" company has been rumored to be getting ready for a public offering for some time now, and CEO John Foley even told The Wall Street Journal that 2019 "makes a lot of sense" for an IPO. As of June 5, the company has filed its S-1 paperwork to go public.

But in the meantime, the company appears to be at a bit of a standstill and even a slight pivot that may be sending mixed signals to potential investors all while alienating the company's most valuable asset: its hardcore fans.

Stalled hiring activity

New job listing activity at the Peloton careers site have cooled off since we last covered it. In October, the company was on a hiring spree with as many as 343 openings. Since then, openings have cooled to early-2019 levels.

Product pivots

Peloton's massive, cult-like popularity stems largely from its core product: its bicycle spin classes. The experience is attractive to those who don't want to venture out to Soul Cycle-like in-person classes. It's also a massive revenue and profit generator for Peloton. Not only do customers drop serious money for the equipment, but they also hook into a subscription model for classes.

It stands to reason, then, that the company would want to replicate this success in other areas. It attempted to do so with its Tread running machines and classes. However, that product hasn't garnered the same sales or following as the cycling classes. Evidence of this can be found in hiring activity for Peloton jobs tagged for its Tread team.

If convincing consumers to buy a $2,700 machine is too much to ask, Peloton is also betting on becoming the "Netflix of fitness" with its Peloton Digital streaming service that offers fitness classes — both live and pre-recorded — for $19.49 per month. Just this week, Peloton brought on two TV executives to help the company develop more content to over 300 fitness shows per week in a new 35,000 square-foot broadcast studio in New York.

Retail for big spenders

Soft product — digital content and subscription services — may be a direction Peloton is taking things, but it does operate a fairly expansive retail presence with showrooms throughout the United States.

Mainly created to sell product — those $2,700 cycles and treadmills along with branded athletic apparel — Peloton Showrooms are strategically located in North America's most spendy areas. The average median income for a Peloton Showroom comes in at $71,000, with a particular focus on well-to-do areas in the Bay Area (a Sunnyvale showroom sells to customers with a median income of $106,000) and the east coast.

Risk of alienating hardcore fans

Peloton's fan base and growth suggest a near-cult-like response to its offerings. Now, the company will need to engage them and branch out into broader audiences as it aims to grow its footprint and even possibly rebrand parts of the business. It is another example of a growing company fighting to maintain its identity while increasing profitability - but any young brand would give up just about anything to have the legion of advocates and influencers Peloton does.

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