EnFitness equipment maker Peloton reported FQ2’21 (Q4’20) revenues which climbed 128% year over year on the back of increased equipment sales linked to stay-at-home exercise during the pandemic. The firm has continued “to work to address long order-to-delivery timeframes” with the ramp up of a new factory in Taiwan.
Yet, “well-publicized West Coast port delays and COVID-related factors continue to present challenges“. While there’s been a slowing rate of growth in shipping activity into the U.S. in January, as flagged in Panjiva’s research of Jan. 27, that provides little relief and container shipping rates remain elevated.
That’s required additional investments as well as “expedited shipping costs” which have eaten into margins and the firm expects to spend $100 million on additional freight costs in the remainder of fiscal 2021 (calendar H1’21). For context the firm’s revenues will be around $1.1 billion in FQ3’21, leaving additional costs equivalent to 4.5% of revenues.
Panjiva’s data shows that Peloton’s expansion in shipments picked up by 261% sequentially in the three months to Nov. 30 – covering deliveries made in Q4’20. Yet, there may be some evidence of ongoing delivery delays with imports in December and January down by 21.1% on a monthly average basis compared to the three months to Nov. 30.
Source: Panjiva
Peloton’s purchase of Precor provides it with a more diversified revenue base, including commercial settings as well as residential, but also brings it into a similar set of supply chain challenges. Panjiva’s data shows that imports linked to Precor increased by 180.4% sequentially in the three months to Nov. 30 and have dipped 15.8% in the most recent two months.
By contrast total U.S. imports of fitness equipment have continued to increase with a 31.6% increase in the three months to Nov. 30 and a further 17.2% rise in January and December. That pattern of continued improvement can be seen in imports linked to Icon Fitness and Nautilus.
Source: Panjiva
