is bumping up subscription fees for the first time in the US and Canada. It’s balancing out those increases (at least for newcomers) by reducing the prices on some hardware: the Bike, Bike+ and Tread.
Starting on June 1st, the cost of the all-access plan is going up by $5 per month to $44 in the US and by $6 CAD to $55 in Canada, as CNBC
reports. The company won’t change pricing for users elsewhere for now. The cost of the digital-only plan will remain the same.
From 6PM ET today, Peloton will cut prices on some of its products. The price of the Bike will be reduced from $1,745 to $1,445 (which includes shipping and setup). The company is lowering the price of Bike+ by $500 to $1,995. As for Tread, Peloton is cutting the price by $200 to $2,695.
The company is hoping that reducing the upfront cost of its fitness equipment will lower the barrier to entry and help it find more customers. “The pricing changes being announced today are part of CEO Barry McCarthys vision to grow the Peloton community, a spokesperson said.
Peloton’s share price has dropped significantly over the last year, in part due to a pandemic-driven spike in demand for its products tapering off. Reports earlier this year suggested
Peloton had thousands of products sitting in warehouses and on cargo ships and that it was changing its production levels.
In February, Peloton replaced its CEO
at the same time it cut 2,800 jobs (around 20 percent of its corporate workforce). Only a few days before that, rumors suggested
the likes of Amazon, Apple and Nike were interested in buying the company.
By shaking up the pricing structure, Peloton is hoping it can correct course. Focusing on recurring revenue from subscriptions and lowering the cost of hardware could help. The company had already showed a willingness to reduce the price of its devices. It started selling the Peloton Guide set-up camera
(which comes with its heart-rate monitor
) this month for $295. It initially said the system would cost $495