Peloton Interactive Inc (NASDAQ:PTON) shares jumped nearly 5% on Friday afternoon after the company reported stronger-than-expected fiscal first quarter 2026 earnings and issued an upbeat outlook for the coming quarters.
For the September quarter, Peloton posted revenue of $550.8 million, beating Wall Street estimates of $539.6 million.
Adjusted earnings per share (EPS) came in at $0.03, surpassing analyst expectations of breakeven.
Net income rose to $14 million, up $15 million year-over-year, and adjusted EBITDA reached $118 million, a 2% increase from the prior year.
Free cash flow climbed to $67 million, up $57 million from the same period in 2024.
Ending paid connected fitness subscriptions totaled 2.732 million, slightly above the company’s guidance but down 6% year-over-year.
Looking ahead, Peloton issued a better-than-expected outlook for fiscal Q2, projecting revenue between $665 million and $685 million, a modest 0.2% increase year-over-year at the midpoint.
Gross margin is expected to rise to 49%, up 180 basis points from last year, and adjusted EBITDA is forecasted at $55 million to $75 million, up 11% at the midpoint.
Paid connected fitness subscriptions are projected to range from 2.64 million to 2.67 million, reflecting an 8% year-over-year decline at the midpoint.
For the full fiscal year 2026, Peloton expects total revenue of $2.4 billion to $2.5 billion, roughly in line with analyst estimates, while EPS is projected to turn positive at $0.17, improving from a prior negative estimate of $0.29 per share.
Adjusted EBITDA is forecasted at $425 million to $475 million, with free cash flow expected to reach at least $250 million.