• by Sarah Mahoney  @mahoney_sarah, November 7, 2023

On the heels of its latest earnings announcement, Peloton is debuting “Work Out Your Way," a new campaign for the holiday season.

The 60-second spot stars Alex Toussaint and Kendall Toole, two of Peloton's best-known instructors. They lead an intense workout, inspiring people to express themselves along the way, set to hip-hop classic "Tambourine." The instructors are equally motivating to the guy biking in his kitchen and the older couple on their matching treadmills.*

Rather than talk about fitness goals, "we wanted to do something very different," says Oli Snoddy, vice president of consumer marketing, in the announcement. "Whether as a complement to the holidays or an antidote to the season, we just wanted to show fitness as a fun vibe."

Peloton produced the ad with Stink Studios.

Ads are airing in the U.S. and Canada on TV, digital and social. The campaign also kicks off Peloton's holiday promotions.

The announcement follows Peloton’s financial results for the first quarter of its fiscal year. And while the numbers align with expectations, the company is still losing money and subscribers.

Total revenue for the first quarter was $595.5 million, with $180.6 million from connected fitness segment revenue and $415 million from subscription revenue. While that fits neatly into revenue forecasts, it still represents a decline of 3% from the year-ago period and a dip of 7% from the previous quarter.

Peloton now claims 6.4 million members, down 4% from last year’s 6.7 million. The company trimmed losses to $159.3 million, compared to a loss of $408.5 million in the comparable period of last year.

In his quarterly letter to shareholders, Chief Executive Officer Barry McCarthy says the company is “putting the negative surprises and distractions of past quarters in the rearview mirror.”

He also expressed plenty of optimism about international growth and the company’s expanding list of partnerships. So far this year, Peloton has announced collaborations with Liverpool Football Club (LFC), the University of Michigan, Lululemon, New York Road Runners, the NBA and WNBA.

“These partnerships will continue our drive to broaden awareness for Peloton and the impact we have on members’ lives,” he writes.

Using Michigan as an example, he says the university represents “a vast ecosystem that includes students, student-athletes, faculty, staff, alumni, and fans. We want to reach everybody in that ecosystem.”

Those include co-branded bikes, which the company hopes to rent to students and set up in campus rec centers. But the partnership also introduces the Peloton App to students and faculty “to drive reach and relevance across the Michigan ecosystem.”

After those results were announced, Deutsche Bank downgraded Peloton to a “hold” rating, citing a lack of clarity in the company’s growth outlook. “We remain bullish on Peloton having a large total addressable market that can support accelerative growth,” writes analyst Lee Horowitz, particularly given incremental growth that may stem from Peloton’s app, commercial business, and new and growing partnerships. However, he writes, “the confidence in underwriting the success of these growth drivers in the medium term is challenging.”

*An earlier edition of this story incorrectly mentioned Lizzo as part of the campaign.