By Sam Boughedda
Investing.com — According to a report by CNBC on Monday, Peloton Interactive Inc (NASDAQ:PTON) has cut its sales forecasts for its apparel business.
The report said documents obtained by CNBC revealed momentum in the division is fading, following a doubling of revenue from 2020 to 2021.
While the apparel division of Peloton is just a small portion of the company's business, CNBC said it "gives yet another glimpse into how the connected fitness company rode a wave of heightened demand in the midst of the Covid-19 pandemic."
Citing a Peloton internal presentation, the article said Peloton's apparel unit recorded $41 million in revenue in the fiscal year 2020, while in the fiscal year 2021, Covid related comfort trends saw it achieve tremendous growth, with demand outpacing supply. As a result, in FY 2021, it is said to have achieved $107 million in revenue.
However, after initially forecasting apparel sales of $200 million for FY 2022, the company believes it will now be closer to $150 million due to "macro factors" such as supply chain constraints.
Peloton shares are up more than 6% Monday, with the latest news not seeming to have sparked a move to the downside.
In contrast, on Jan. 20, Peloton shares plunged 23% on a report from CNBC that the company was temporarily halting production of its connected fitness products due to fading demand. However, the company quickly came out soon after stating the rumor was false and for the following two days, Peloton shares rose.