What you need to know
- Blackwells Capital has released a new deck designed to shake up things at Peloton.
- The investor argues for sweeping changes to the company's executive team and direction.
- It also calls for a sale to companies like Apple, Amazon, or Nike.
A few months ago, some major investors in Peloton called for major shakeups at the company, including a potential sale to a larger player like Apple. Despite the company's recent change in CEO, that idea does not seem to have changed.
A new deck released by activist investor Blackwells Capital calls for major changes at the company, including shaking up the executive team to ensure proper governance and changing the direction of the business model to Fitness As A Service (FAAS). The second would see Peloton operate more like a software company rather than pushing its own hardware.
Two months since Peloton hired one of the highest paid CEOs in all of corporate America, nothing has fundamentally changed.Peloton's powerful brand, proprietary technology, engaging instructors, and fiercely loyal subscriber base can be shaped into a much more attractive business. But this cannot happen effectively in the public markets, especially with the current leadership in place.
The firm also continues to call for the sale of the company. According to Blackwells, selling Peloton would be the most valuable move for investors in the company. Apple, Amazon, Nike, and Google are all listed as potential companies that would make sense to acquire Peloton. As far as Apple goes, Blackwells lists the following benefits for both companies if it was to acquire Peloton:
- Apple becomes the category leader in digital health & wellness
- Immediate ability to bundle with 100 million Apple watch users
- Gains significant customer data edge to use for applicability across the Apple ecosystem
- Through its preexisting health, wellness, content and lifestyle segments, Apple has a robust opportunity to cross-sell and bundle content offerings such as:
- Apple Fitness+: Full integration of all Apple's preexisting health features and classes
- Apple Music: Integrated apple music to create workout playlist and content (i.e., sort music by BPM or workout time)
- Apple TV+: New exercise content combined with ability to watch Apple TV+ content
- Leading brand and high quality of Peloton offering fits well with Apple's ethos of premium products
- Strategically Defensive Asset: Prevents other big tech / health and wellness competitors from gaining a trophy subscription fitness asset
Of course, all of this is just a major investor calling for changes. There is no guarantee it will have a meaningful impact on what direction Peloton decides to go and there has so far not been any evidence of Apple and the company in talks about a potential acquisition.
If you're not trying to dive into the world of Peloton, Apple Fitness+ is a fantastic workout subscription service for anyone with an Apple Watch.
New workouts every week and a positive attitude for your fitness journey.
Fitness+ helps you find the workouts that are right for you, with a vast collection of sessions in practices like core training, yoga, and rowing. Each class is taught by a top-flight instructor, and new classes are added every Monday.
