When the AI fitness equipment company went public in 2019, Peloton ($PTON) knew it was only a matter of time before people were opting out of crowded gyms for at-home workouts. Its business was fated on this presumption. And then, as if it was designed in a lab (kidding), the Coronavirus pandemic hit, and fitness enthusiasts didn’t have a choice.

Gyms remain closed and it’s safe to assume that people won't be rushing back when they reopen. Peloton, along with a host of new competing AI exercise brands, is poised for success. Those with thousands of dollars to spare ($2,245 for a bike or $4,295 for a treadmill) can get the benefit of a personal trainer or a high-intensity workout class from their Peloton’s built-in screens.

Yesterday, Peloton ($PTON) shares were trading 6.11% higher as investors considered Coronavirus’ second wave as parts of the country started to reopen. The company’s revenue is up 66% and subscribers are up 94% year over year in the most recent quarter. The average monthly workouts in the third quarter were 17.7, compared to 13.9 in the prior-year period. 

Peloton’s product review count continues to rise as more people try to stay active in quarantine,  up 25% in just three months. Reviews from March forward overwhelmingly contain the words “pandemic,” “quarantine,” and “coronavirus.”

“Wow, I was confident that my Peloton bike would be a great investment, but it’s even better than I thought. The more you ride, the cheaper the up-front cost seems...Way cheaper in the long run, and more convenient, than paying for spin classes at a studio or gym,” one review from last month reads. “When I bought my bike in January 2020, little did I know that Coronavirus was coming and we would all be stuck in our homes!”

But Peloton shouldn’t get too comfortable. The novelty seems to have worn off on social media. Facebook mentions peaked at 97,400 in March, but have since plummeted 73%.

Even more worrisome for the company is its competition, which is ample now. AI fitness companies like Echelon, Hydrow, and Tonal are popping up and looking to turn our homes into personal gyms. While these brands haven’t caught up to Peloton’s speedy ascent, they’ve certainly gained traction in quarantine.

Echelon ($PRIVATE:ECHELONFIT) has Peloton beat on product variety. The company offers an “Echelon Reflect” AI mirror, the “Connect” bike, and a rowing machine. It’s still a somewhat small operation, but it’s growing fast. Facebook mentions and page likes spiked with the start of quarantine in March. 

Hydrow ($PRIVATE:HYDROW) makes $2,199 “smart” rowing machines and will soon expand its product line and incorporate yoga equipment. Today, the Cambridge, Massachusetts-based startup raised $25 million from investors led by the LVMH-backed private equity firm L Catterton. Sales have surged by 400% during the pandemic, as Bloomberg reports.

The direct-to-consumer company has watched its audience grow via social media. Its Instagram follower count has risen by 39% this year.

Tonal’s ($PRIVATE:TONAL) $3000 machines focus on strength and resistance training. The wall-mounted screen includes built-in training bars and bands, plus on-demand coaching and personalized exercises. Its Instagram following soared 54% from January to May.

If Peloton wants to stay ahead of competitors, the company will have to find an edge, something that these other at-home fitness brands lack. Following this logic, Peloton might benefit from making its products more affordable. The Peloton app is a step in the right direction. Memberships cost $12.99 per month for thousands of on-demand workouts. Making Peloton accessible beyond wealthy people with large homes might be the key to enduring success. But, then again, a wider audience might strip the product of its aspirational luster.

About the Data:

Thinknum tracks companies using the information they post online - jobs, social and web traffic, product sales, and app ratings - and creates data sets that measure factors like hiring, revenue, and foot traffic. Data sets may not be fully comprehensive (they only account for what is available on the web), but they can be used to gauge performance factors like staffing and sales.

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