Slides
Page 1
PELOTON PELOTON Earnings Update Q4 FY2026
Page 2
© Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved. 2 Disclaimer SAFE HARBOR STATEMENT This presentation contains forward - looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 . We intend such forward - looking statements to be covered by the safe harbor provisions for forward - looking statements contained in Section 27 A of the Securities Act of 1933 , as amended and Section 21 E of the Securities Exchange Act of 1934 , as amended . All statements contained in this presentation, other than statements of historical fact, including, without limitation, statements regarding our expected financial results for the first quarter of and the full fiscal year 2027 , the scope, impact and anticipated costs associated with the Original Series Bike+ recall, our execution and timing of, and the expected benefits from our restructuring initiatives and cost - saving measures, the cost savings and other efficiencies of expanding relationships with our third - party partners, details regarding and the timing of the launch of new products and services, our initiatives with retailer partners and our efforts to optimize our retail showroom footprint, the prices of our products and services, our future operating results and financial position, our business strategy and plans, market growth, and our objectives for future operations, are forward - looking statements . The words “believe,” “may,” “will,” “estimate,” “potential,” “continue,” “anticipate,” “intend,” “expect,” “could,” “would,” “project,” “plan,” “target,” and similar expressions are intended to identify forward - looking statements, though not all forward - looking statements use these words or expressions . Capitalized terms used in this presentation but not defined herein shall have the meanings ascribed to them in our Annual Report on Form 10 - K for the year ended June 30 , 2026 . We have based these forward - looking statements on our current expectations and projections about future events and trends that we believe may affect our financial condition, results of operations, business strategy, short - term and long - term business operations and objectives, and financial needs . These forward - looking statements are subject to a number of risks, uncertainties, assumptions, and other important factors that could cause actual results to differ materially from those stated, including, without limitation : our ability to successfully execute our business strategy, including our commercial strategy ; our ability to achieve and maintain future profitability and positive free cash flow ; our ability to attract and maintain Subscribers ; our ability to accurately forecast consumer demand for our products and services and adequately manage our inventory ; our ability to achieve the expected benefits of our restructuring initiatives and other cost - saving measures, including our 2025 Restructuring Plan, which has been substantially implemented ; our ability to effectively manage our growth and costs ; our ability to anticipate consumer preferences and successfully develop and offer new products and services in a timely manner, and effectively manage the introduction of new or enhanced products and services ; demand for our products and services, including any declines in sales of our Connected Fitness Products, and growth of the connected fitness and wellness markets ; our ability to maintain the value and reputation of the Peloton and Precor brands ; disruptions or failures of our information technology systems, websites, or those of third parties on whom we rely ; our reliance on, and lack of control over, a limited number of suppliers, contract manufacturers, and logistics partners for our Connected Fitness Products ; our ability to predict our long - term performance and changes to our revenue as our business matures ; the effects of increased competition in our markets and our ability to compete effectively ; our dependence on third - party licenses for use of music in our content ; actual or perceived defects in, or safety of, our products, including any impact of product recalls, including our Original Series Bike and Original Series Bike+ seat post recalls, quality improvement or similar programs, or legal or regulatory claims, proceedings, or investigations involving our products ; increases in component costs, long lead times, supply shortages, or other supply chain disruptions ; accidents, safety incidents, or workforce disruptions ; seasonality or other fluctuations in our annual or quarterly results ; our ability to generate class content ; risks related to acquisitions or dispositions and our ability to successfully operate and further integrate any such acquired companies into our operations and control environment, including our Commercial Business Unit ; risks related to expansion into international markets, including political and economic instability of foreign markets ; risks related to payment processing, cybersecurity, or data privacy ; risks related to artificial intelligence (“AI”) and our integration of AI into our products, services, and business operations, including risks related to flawed algorithms, intellectual property infringement, data privacy, and evolving regulatory requirements ; risks related to our Peloton Apps and their ability to work with a range of mobile and streaming technologies, systems, networks, and standards ; our ability to effectively price and market our Connected Fitness Products and subscriptions ; any inaccuracies in, or failure to achieve, operational and business metrics, or forecasts ; our ability to maintain effective internal control over financial and management systems ; impacts from warranty claims or product returns ; our ability to maintain, protect, and enhance our intellectual property ; our ability to comply with laws and regulations that currently apply or become applicable to our business, both in the United States and internationally ; risks related to changes in global trade policies, including our ability to mitigate the effects of tariffs and other non - tariff restrictions, such as taxes, quotas, local content rules, customs detentions and other protectionist measures, and our ability to obtain any tariff refunds or rebates ; our reliance on third parties for computing, storage, processing, and similar services, as well as delivery and installation of our products ; our ability to attract and retain highly skilled personnel, including key members of senior management, and maintain our culture ; the impact of macroeconomic conditions, including inflation, changes in consumer spending, recession, and rising interest rates, on demand for our products and services ; risks related to pending or future litigation, government investigations, and regulatory proceedings, including securities litigation, patent litigation, and product liability matters ; risks related to our common stock and indebtedness ; and those risks and uncertainties described in our Annual Report on Form 10 - K, Quarterly Reports on Form 10 - Q and Current Reports on Form 8 - K filed with the Securities and Exchange Commission, as such risks and uncertainties may be updated in our filings with the Securities and Exchange Commission, which are available on the Investor Relations page of our website at https : //investor . onepeloton . com/investor - relations and on the SEC website at www . sec . gov . You should not rely upon forward - looking statements as predictions of future events . The events and circumstances reflected in the forward - looking statements may not be achieved or occur . Although we believe that the expectations reflected in the forward - looking statements are reasonable, we cannot guarantee future results, performance, or achievements . Our forward - looking statements speak only as of the date of this presentation, and we undertake no obligation to update any of these forward - looking statements for any reason after the date of this presentation or to conform these statements to actual results or revised expectations, except as required by law .
Page 3
3 Disclaimer (cont’d) NON - GAAP FINANCIAL MEASURES This presentation includes references to non - GAAP financial measures, including Adjusted EBITDA, Trailing Twelve Months Adjusted EBITDA, Free Cash Flow, Trailing Twelve Months Free Cash Flow, Adjusted Operating Expenses, Adjusted Operating Expenses % of Total Revenue, Net Debt, Gross Principal Debt Outstanding, Net of Cash and cash equivalents, Gross Leverage Ratio, and Net Leverage Ratio . We use these non - GAAP financial measures for financial and operational decision - making and as a means to evaluate period - to - period comparisons . We believe that these non - GAAP financial measures provide meaningful supplemental information regarding our performance by excluding certain items that may not be indicative of our recurring core business operating results . We believe that both management and investors benefit from referring to these non - GAAP financial measures in assessing our performance and when planning, forecasting, and analyzing future periods . These non - GAAP financial measures also facilitate management's internal comparisons to our historical performance . We believe these non - GAAP financial measures are useful to investors both because ( 1 ) they allow for greater transparency with respect to key metrics used by management in its financial and operational decision - making and ( 2 ) they are used by our institutional investors and the analyst community to help them analyze the health of our business . These non - GAAP financial measures are not based on any comprehensive set of accounting rules or principles and should not be considered a substitute for, or superior to, financial measures calculated in accordance with GAAP, and may be different from non - GAAP financial measures used by other companies . In addition, these non - GAAP financial measures should be read in conjunction with the Company’s financial statements prepared in accordance with GAAP . The reconciliations of each non - GAAP financial measure to the corresponding GAAP measure should be carefully evaluated . See the Financial Appendix for reconciliations of historical non - GAAP financial measures included in this presentation to the nearest GAAP financial measure . We are not able to provide a reconciliation of these non - GAAP financial measures to their comparable GAAP financial measures on a forward - looking basis without unreasonable efforts including, because, of the inherent difficulties in forecasting certain amounts that affect Net income (loss) and Adjusted EBITDA, and Net cash provided by (used in) operating activities and Free Cash Flow . As a result, we do not believe that a GAAP reconciliation would provide meaningful supplemental information about our outlook . © Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved.
Page 4
Key Results FY2026 4 Revenue $2,446m Gross Margin 52.6% Adjusted EBITDA 1 $468m Connected Fitness Subscriptions 2 2.553m Above ($2,420m - $2,440m guidance) Above (~52.5% guidance) Below ($470m - $480m guidance) Includes $ 23.8m nonrecurring accrued legal contingency In - line (2.550m - 2.570m guidance) Free Cash Flow 1 $378m 1.8% YoY 170 bps YoY 16.0% YoY 16.7% YoY 8.8% YoY 1. Non - GAAP measure. See Financial Appendix for reconciliation of GAAP to non - GAAP measures. 2. Ending Paid Connected Fitness Subscriptions. © Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved. Above (~$350m guidance)
Page 5
Peloton invests in the future of Pilates with targeted acquisition of Skōp 5 © Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved. “Pilates is a category ripe for the same kind of experiential reinvention we brought to cardio.” - Peter Stern, CEO As an early innovator in Connected Pilates, Skōp brings foundational technologies and deep expertise that will build on Peloton’s leadership in at - home Pilates, helping us push further into strength and scale our comprehensive wellness ecosystem .
Page 6
Commercial Business Unit Achieved double digit revenue growth in FY2026 6 Launching Fall 2026: The Commercial Series Peloton’s first - ever Bike and Tread designed for high - traffic gym environments expected to be available in Q2 FY2027 Renderings of Peloton Commercial Series © Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved.
Page 7
7 FY26 Product & Content Updates © Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved. Cross Training Series: Peloton’s first portfolio - wide refresh, standardizing swivel screen to optimize cross training. Peloton IQ: AI - powered personalized software providing workout recommendations, performance insights, form feedback & rep counting. Content Library Expansion: Released 11,500 new classes in FY26, expanding our current library to more than 65,000 classes. 69% of completed workouts in FY26 were from classes released in the same fiscal year. Breathwrk: Acquired award - winning app specializing in breathing exercises, expanded to include meditation content. New Instructors : Welcomed three new Strength instructors.
Page 8
8 01 Fourth Quarter Fiscal 2026 Results © Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved.
Page 9
408 398 413 428 437 199 152 244 203 171 607 551 657 631 608 Q4 FY25 Q1 FY26 Q2 FY26 Q3 FY26 Q4 FY26 Connected Fitness Products Revenue Subscription Revenue 9 +0.1% YoY Q4 Total Revenue $608m $1m / 0.1% YoY Q4 Subscription Revenue $437m $28m / 7% YoY Q4 Connected Fitness Products Revenue $171m - $28m / - 14% YoY Revenue Delivered positive revenue growth YoY Connected Fitness Products Revenue Subscription Revenue ($m) © Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved.
Page 10
54.1% 51.5% 50.5% 51.9% 56.7% Q4 FY25 Q1 FY26 Q2 FY26 Q3 FY26 Q4 FY26 Total Gross Margin Increased 260 bps YoY 1 10 1. Beginning in Q 1 FY 26 , the Company now assigns executive compensation and other corporate overhead costs associated with our corporate facilities to the various expense captions that these costs relate to . For a reconciliation of Total Gross Margin for Q 4 FY 25 to the revised amount inclusive of allocated overhead costs, refer to the reconciliation tables in the Financial Appendix . +260 bps YoY Q4 Total Gross Profit $344m $16m / 5% YoY © Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved.
Page 11
70.8% 1.1% 71.9% 68.6% 72.1% 71.1% 73.6% Q4 FY25 Q1 FY26 Q2 FY26 Q3 FY26 Q4 FY26 16.2% 1.1% 17.3% 6.9% 13.9% 11.3% 13.4% Q4 FY25 Q1 FY26 Q2 FY26 Q3 FY26 Q4 FY26 13.4% - 283 bps YoY 1 73.6% +277 bps YoY 1 Segment Adjusted Gross Margins Subscription Adjusted Gross Margin Increased 277 bps YoY 11 1. Beginning in Q1 FY26, the Company now assigns executive compensation and other corporate overhead costs associated with our c orp orate facilities to the various expense captions that these costs relate to. For a reconciliation of our reported segment gro ss margins to the Segment Adjusted Gross Margins for Q4 FY25, refer to the reconciliation tables in the Financial Appendix. Q4 Subscription Adj. Gross Margin 1 Q4 Connected Fitness Products Adj. Gross Margin 1 1 1 1 1 © Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved. 1 1
Page 12
$257m - $5m / - 2% YoY Operating Expenses and SBC Exceeded $100m of run - rate cost savings in FY26 1. Non - GAAP measure. See Financial Appendix for reconciliation of GAAP to non - GAAP measures. Excludes restructuring, impairment, and supplier settlements. 12 Q4 Stock - Based Compensation Expense ($m) Q4 Adj. Operating Expenses 1 ($m) $43m - $10m / - 19% YoY 146 230 170 112 82 153 106 81 67 152 98 83 151 161 153 186 120 131 151 125 101 103 110 116 79 80 77 69 59 60 60 56 62 65 59 57 376 471 400 368 260 344 317 261 230 320 267 257 63% 63% 56% 57% 44% 51% 51% 43% 42% 49% 42% 42% – 10.0% 20.0% 30.0% 40.0% 50.0% 60.0% 70.0% $0 $100 $200 $300 $400 $500 $600 $700 Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q2 FY25 Q3 FY25 Q4 FY25 Q1 FY26 Q2 FY26 Q3 FY26 Q4 FY26 S&M G&A R&D Adj. Operating Expenses % of Total Revenue 74 67 68 103 47 61 68 53 47 56 53 43 12% 9% 9% 16% 8% 9% 11% 9% 9% 8% 8% 7% – 5.0% 10.0% 15.0% 20.0% 25.0% 30.0% $0 $20 $40 $60 $80 $100 $120 Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q2 FY25 Q3 FY25 Q4 FY25 Q1 FY26 Q2 FY26 Q3 FY26 Q4 FY26 SBC SBC % of Total Revenue © Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved. 1 Includes $23.8m nonrecurring accrued legal contingency
Page 13
404 406 429 466 468 324 380 345 401 378 Q4 FY25 Q1 FY26 Q2 FY26 Q3 FY26 Q4 FY26 Adjusted EBITDA Free Cash Flow Quarterly TTM 2 Adj. EBITDA / TTM Free Cash Flow 1 ($m) Profitability Gains driven by disciplined cost management am 13 Quarterly Adj. EBITDA / Free Cash Flow 1 ($m) Q4 Adjusted EBITDA 1 $142m +$2m / 2% YoY Includes $23.8m nonrecurring accrued legal contingency Q4 Free Cash Flow 1 $89m - $24m / - 21% YoY 140 118 81 126 142 112 67 71 151 89 Q4 FY25 Q1 FY26 Q2 FY26 Q3 FY26 Q4 FY26 Adjusted EBITDA Free Cash Flow 1. Non - GAAP measure. See Financial Appendix for reconciliation of GAAP to non - GAAP measures 2. Trailing twelve months (‘TTM’) Profitability Adj. EBITDA gains driven by disciplined cost management © Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved. Includes $23.8m nonrecurring accrued legal contingency
Page 14
1. Non - GAAP measure. See Financial Appendix for reconciliation of GAAP to non - GAAP measures 14.0x 6.2x 4.6x 3.8x 3.8x 3.6x 2.9x 2.8x 7.5x 2.9x 1.9x 1.2x 1.1x 0.8x 0.4x 0.3x Q1 FY25 Q2 FY25 Q3 FY25 Q4 FY25 Q1 FY26 Q2 FY26 Q3 FY26 Q4 FY26 Gross Leverage Ratio Net Leverage Ratio Balance Sheet Meaningful deleveraging enabling next phase of strategic capital allocation 14 11.2x Reduction in Gross Leverage 7.2x Reduction in Net Leverage Q4 Gross Leverage Ratio 1 2.8x - 1.0x YoY Q4 Net Leverage Ratio 1 0.3x - 1.0x YoY Q4 Net Debt 1 $93m - $367m / - 80% YoY © Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved.
Page 15
1.8% 1.6% 1.9% 1.2% 2.2% - 11bps - 22bps 46bps - 7bps 37bps Q4 FY25 Q1 FY26 Q2 FY26 Q3 FY26 Q4 FY26 508 1,086 2,317 2,917 2,998 2,976 2,800 2,553 FY19 FY20 FY21 FY22 FY23 FY24 FY25 FY26 Average Net Monthly Paid Connected Fitness Subscription Churn 15 Ending Paid Connected Fitness Subscriptions Highly retentive, high margin subscription business 26% CAGR since FY19 Ending Paid Connected Fitness Subscriptions (000s) 1,2 Avg. Net Monthly Paid Connected Fitness Subscription Churn 1 price adjustments YoY bps change 1. Beginning January 1 , 2025 , the Company migrated its subscription data model for reporting Ending Paid Connected Fitness Subscriptions and Average Net Monthly Paid Connected Fitness Subscription Churn to a new data model that provides greater visibility to any change to a subscription’s payment status when it occurs . The new model gives the Company more precise and timely data on subscription pause and churn behavior . Information prior to Q 3 FY 25 has been revised to conform with the current period presentation . The impact of this change in the model on Ending Paid Connected Fitness Subscriptions and Average Net Monthly Paid Connected Fitness Subscription Churn for the periods in FY 25 and prior is immaterial . 2. Beginning July 1 , 2023 , the Company no longer included paused Connected Fitness subscriptions in Ending Paid Connected Fitness Subscriptions and began treating a pause as a churn event in Average Net Monthly Paid Connected Fitness Subscription Churn . All figures above exclude paused Connected Fitness Subscriptions . Please refer to the FY 2023 10 - K for more information about this metric change . © Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved. 17bps impact from one - time items
Page 16
© Peloton 2012-2024, Peloton Interactive, Inc. All rights reserved. 16 02 Outlook © Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved.
Page 17
1. Non - GAAP measure . See Financial Appendix for reconciliation of GAAP to non - GAAP measures for FY 26 . 17 Outlook for Full Year FY27 As Reported Full Year FY27 Range % Change (Midpoint) FY26 Low High YoY Financial Results ($m) Total Revenue $2,446 $2,300 $2,400 - 3.9% Total Gross Margin 52.6% ~54.0% 140 bps Adjusted EBITDA 1 $468 $475 $525 6.8% Free Cash Flow 1 $378 at least $350 © Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved.
Page 18
1. Non - GAAP measure . See Financial Appendix for reconciliation of GAAP to non - GAAP measures for Q 1 FY 26 . 18 Outlook for Q1 FY27 As Reported Q1 FY27 Range % Change (Midpoint) Q1 FY26 Low High YoY Financial Results ($m) Total Revenue $551 $545 $565 0.8% Total Gross Margin 51.5% ~57.0% 550 bps Adjusted EBITDA 1 $118 $135 $145 18.4% User Metrics (m) Ending Paid Connected Fitness Subscriptions 2.732 2.455 2.475 - 9.8% © Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved.
Page 19
Webcast Information 19 We will host a live call at 8 : 30 a . m . ET on Thursday, August 6 , 2026 to discuss our financial results . To avoid delays, we encourage participants to register at least 15 minutes before the start of the call . A live webcast of the call and our earnings presentation will be available at https : //investor . onepeloton . com/news - and - events/events , and a replay will be available on the investor relations page of the Company's website for 30 days . © Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved.
Page 20
03 Our Business 20 © Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved.
Page 21
© Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved. 21 [Our Purpose / Our Mission] Our purpose Empower people to live fit, strong, long, and happy Our mission Bring integrated fitness and wellness experiences to Members anytime, anywhere © Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved. 21
Page 22
© Peloton 2012-2024, Peloton Interactive, Inc. All rights reserved. 22 Four strategic pillars Business excellence Members for life Meet Members everywhere Improve Member outcomes © Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved.
Page 23
World Class Equipment All Cross Training Series equipment measured has an NPS above 70 23 Connected Fitness Segment 1. NPS measured using Q4 FY26 NPS for Cross Training Series equipment. 1 © Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved.
Page 24
24
Page 25
25 Engaging Content Expert Instructors teach live and on - demand Subscription Segment Expansive Content Library: Currently over 65,000 live and on - demand classes across more than 15 disciplines, ensuring fresh, daily engagement for every fitness level World - Class Talent: Over 50 premier Instructors leading 100+ structured programs designed to drive habit formation and long - term retention Entertainment and Scenic: Stream movies and TV or virtually visit iconic locations around the world, with real - time metrics and guided workouts in the background Scalable Global Reach: Content localized into 3 languages; piloting AI dubbing for more efficient translation © Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved.
Page 26
Cardio 55% Strength 30% Meditation 3% Recovery & Sleep 12% 26 Diversified Member Engagement Q4 FY26 Workouts by Discipline Subscription Segment Cardio: Boxing, Cardio, Cycling, Outdoor, Row, Running, and Walking Meditation: Meditation (excluding Sleep Meditation) Recovery & Sleep: Stretching and Sleep Meditation Strength: Barre, Bike Bootcamp, Pilates, Row Bootcamp, Strength, Tread Bootcamp, Yoga, and Strength+ content Pilates workouts increased +44% year - over - year in Q4 © Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved.
Page 27
Gamified reward system designed to incentivize daily active usage, consistency, and milestone achievements Social engagement engine driving accountability and lower churn through user - created micro - communities Intuitive Software Peloton IQ, Teams, and Club Peloton designed to keep Members engaged 27 Subscription Segment Peloton IQ Teams Club Peloton Data - driven coaching and personalized insights to optimize Member training, performance, and recovery © Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved.
Page 28
© Peloton 2012-2024, Peloton Interactive, Inc. All rights reserved. 28 04 Financial Appendix © Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved.
Page 29
Quarter Ended Trailing Twelve Months (“TTM”) Ended (1) Q4 FY25 Q1 FY26 Q2 FY26 Q3 FY26 Q4 FY26 Q4 FY25 Q1 FY26 Q2 FY26 Q3 FY26 Q4 FY26 (in millions) Net income (loss) $ 21.6 $ 13.9 $ (38.8) $ 26.4 $ 61.6 $ (118.9) $ (104.1) $ (50.9) $ 23.2 $ 63.2 Adjusted to exclude the following: Total other expense, net 7.0 26.7 24.7 25.6 20.6 79.3 93.4 72.9 84.0 97.6 Income tax expense (benefit) 1.0 0.7 (0.2) 0.4 (1.0) 3.4 3.2 2.3 1.9 (0.1) Depreciation and amortization expense 20.8 16.8 15.4 13.6 11.5 89.7 81.6 74.2 66.5 57.2 Stock-based compensation expense 52.5 47.5 54.6 52.7 43.1 228.8 229.1 222.2 207.3 197.8 Impairment expense 11.8 8.3 23.0 3.4 (0.1) 64.1 67.5 73.7 46.5 34.6 Restructuring expense 25.2 4.4 2.7 4.1 6.7 33.8 35.3 34.7 36.4 17.9 Supplier settlements — — — — — 23.5 — — — — Adjusted EBITDA (2) $ 140.0 $ 118.3 $ 81.4 $ 126.2 $ 142.3 $ 403.6 $ 406.0 $ 429.0 $ 465.8 $ 468.2 Reconciliation of Net Income (Loss) to Adjusted EBITDA Non-GAAP Financial Measures ____________________________________ (1) Trailing Twelve Month (“TTM”) Adjusted EBITDA is computed by summing our reported Adjusted EBITDA for the trailing four fiscal quarters. (2) We define Adjusted EBITDA as net income (loss) adjusted to exclude: other expense (income), net; net (gains) losses on debt refinancing; income tax expense (benefit); depreciation and amortization expense; stock-based compensation expense; impairment expense; restructuring expense; product recall related matters; certain litigation and settlement expenses; supplier settlements; and other adjustment items that arise outside the ordinary course of our business. 29© Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved.
Page 30
Quarter Ended Trailing Twelve Months (“TTM”) Ended (1) Q4 FY25 Q1 FY26 Q2 FY26 Q3 FY26 Q4 FY26 Q4 FY25 Q1 FY26 Q2 FY26 Q3 FY26 Q4 FY26 (in millions) Net cash provided by operating activities 117.1 71.9 71.9 152.7 91.0 333.0 392.4 357.6 413.6 387.6 Capital expenditures (4.7) (4.5) (0.9) (2.2) (2.3) (9.3) (12.0) (12.2) (12.3) (9.9) Free Cash Flow (2) $ 112.4 $ 67.4 $ 71.0 $ 150.5 $ 88.7 $ 323.7 $ 380.4 $ 345.5 $ 401.3 $ 377.6 Reconciliation of Net Cash Provided by Operating Activities to Free Cash Flow Non-GAAP Financial Measures ____________________________________ (1) Trailing Twelve Month (“TTM”) Free Cash Flow is computed by summing our reported Free Cash Flow for the trailing four fiscal quarters. (2) We define Free Cash Flow as Net cash provided by (used in) operating activities less Capital expenditures. 30© Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved.
Page 31
Quarter Ended Fiscal Year Ended Q4 FY25 FY25 As Reported Allocated Overhead Costs Segment Adjusted Gross profit As Reported Allocated Overhead Costs Segment Adjusted Gross profit (dollars in millions) Gross Profit: Connected Fitness Products $ 34.4 $ (2.2) $ 32.3 $ 111.2 $ (14.8) $ 96.4 Subscription 293.7 (4.5) 289.2 1,157.1 (17.4) 1,139.7 Total Gross profit $ 328.1 $ (6.6) $ 321.5 $ 1,268.3 $ (32.2) $ 1,236.1 Total Gross Margin 54.1 % 53.0 % 50.9 % 49.6 % Connected Fitness Products Gross Margin 17.3 % 16.2 % 13.6 % 11.8 % Subscription Gross Margin 71.9 % 70.8 % 69.1 % 68.1 % Change in Segment Measure of Profitability Quarter Ended Fiscal Year Ended Q4 FY25 FY25 (in millions) Total Segment Adjusted Gross profit $ 321.5 $ 1,236.1 Allocated overhead costs (6.6) (32.2) Total Gross Profit (As Reported) $ 328.1 $ 1,268.3 Sales and marketing (80.6) (421.6) General and administrative (125.1) (527.3) Research and development (55.8) (234.2) Impairment expense (11.8) (64.1) Restructuring expense (25.2) (33.8) Supplier settlements — (23.5) Total other expense, net (7.0) (79.3) Income (loss) before income taxes $ 22.6 $ (115.6) Beginning in Q1 FY26, the Company changed its measure of segment profitability to Segment Adjusted Gross profit to better align with the manner in which our chief operating decision maker evaluates segment performance and makes resource allocation decisions. Segment Adjusted Gross profit is defined as Revenue less Adjusted Cost of revenue incurred by the segment. Adjusted Cost of revenue includes costs directly related to the function of each segment, including certain corporate overhead costs, such as a portion of depreciation, rent and occupancy charges related to the Company’s corporate facilities, and personnel-related expenses for certain executives and departments (“Allocated overhead costs”). For comparability purposes, the Company is providing supplemental historical segment financial information to reflect the new segment measure of profitability: A reconciliation between reportable Total Gross Profit to consolidated Income (loss) before income taxes is as follows: 31© Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved.
Page 32
Quarter Ended Q1 FY24 Q2 FY24 Q3 FY24 Q4 FY24 Q1 FY25 Q2 FY25 Q3 FY25 Q4 FY25 Q1 FY26 Q2 FY26 Q3 FY26 Q4 FY26 (in millions) Total operating expenses 417.6 486.5 455.9 375.3 291.2 364.3 350.5 298.5 242.4 345.6 274.8 263.2 Less: Impairment expense 24.0 3.6 19.0 10.6 4.9 16.7 30.7 11.8 8.3 23.0 3.4 (0.1) Less: Restructuring expense 17.8 13.4 37.6 (2.8) 2.9 3.3 2.4 25.2 4.4 2.7 4.1 6.7 Less: Supplier settlements — (1.5) (0.9) (0.3) 23.5 — — — — — — — Adjusted operating expenses (1) $ 375.8 $ 471.0 $ 400.2 $ 367.8 $ 259.9 $ 344.3 $ 317.5 $ 261.5 $ 229.7 $ 319.9 $ 267.3 $ 256.6 Total Revenue $ 595.5 $ 743.6 $ 717.7 $ 643.6 $ 586.0 $ 673.9 $ 624.0 $ 606.9 $ 550.8 $ 656.5 $ 630.9 $ 607.7 Total operating expenses % of Total Revenue 70 % 65 % 64 % 58 % 50 % 54 % 56 % 49 % 44 % 53 % 44 % 43 % Adjusted operating expenses % of Total Revenue (2) 63 % 63 % 56 % 57 % 44 % 51 % 51 % 43 % 42 % 49 % 42 % 42 % Reconciliation of Total Operating Expenses to Adjusted Operating Expenses Non-GAAP Financial Measures ____________________________________ (1) We define Adjusted operating expenses as Total operating expenses adjusted to exclude: Impairment expense, Restructuring expense, and Supplier settlements. (2) We define Adjusted operating expenses % of Total Revenue as Adjusted operating expenses divided by Total Revenue. 32© Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved.
Page 33
As Of Quarter End Q4 FY26 Q4 FY25 (in millions) Current portion of debt $ 10.0 $ 208.5 Convertible senior notes, net of current portion 344.9 343.6 Term loan, net of current portion 944.2 946.9 Total debt (1) 1,299.1 1,498.9 Less: Cash and cash equivalents 1,206.6 1,039.5 Net Debt (2) $ 92.6 $ 459.4 ____________________________________ (1) Total debt consists of the carrying amount of Current portion of debt, Convertible senior notes, net of current portion, and Term loan, net of current portion, on our Consolidated Balance Sheets, which includes unamortized debt discount and issuance costs. (2) We define Net Debt as Total debt less Cash and cash equivalents. Reconciliation of Total Debt to Net Debt Non-GAAP Financial Measures 33© Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved.
Page 34
Gross Principal Debt Outstanding, Net of Cash and cash equivalents, Gross Leverage Ratio, and Net Leverage Ratio Non-GAAP Financial Measures Trailing Twelve Months (“TTM”) Ended Q1 FY25 Q2 FY25 Q3 FY25 Q4 FY25 Q1 FY26 Q2 FY26 Q3 FY26 Q4 FY26 (dollars in millions) Net (loss) income $ (393.5) $ (290.6) $ (171.0) $ (118.9) $ (104.1) $ (50.9) $ 23.2 $ 63.2 Adjusted to exclude the following: Total other expense, net 63.2 98.9 93.0 79.3 93.4 72.9 84.0 97.6 Net gain on debt refinancing (53.6) (53.6) (53.6) — — — — — Income tax (benefit) expense (0.1) 2.3 2.5 3.4 3.2 2.3 1.9 (0.1) Depreciation and amortization expense 102.9 100.5 94.6 89.7 81.6 74.2 66.5 57.2 Stock-based compensation expense 285.3 280.2 281.7 228.8 229.1 222.2 207.3 197.8 Impairment expense 38.1 51.2 62.9 64.1 67.5 73.7 46.5 34.6 Restructuring expense 51.7 41.1 5.8 33.8 35.3 34.7 36.4 17.9 Supplier settlements 20.9 22.4 23.2 23.5 — — — — Product recalls (12.3) (5.8) (5.8) — — — — — Litigation and settlement expenses 7.8 3.7 0.6 — — — — — Adjusted EBITDA (1) $ 110.2 $ 250.3 $ 333.9 $ 403.6 $ 406.0 $ 429.0 $ 465.8 $ 468.2 Gross principal debt outstanding (2) $ 1,546.5 $ 1,544.0 $ 1,541.5 $ 1,539.0 $ 1,536.5 $ 1,534.0 $ 1,332.5 $ 1,330.0 Less: Cash and cash equivalents 722.3 829.0 914.3 1,039.5 1,103.6 1,179.6 1,126.3 1,206.6 Gross principal debt outstanding, net of cash and cash equivalents (3) $ 824.2 $ 715.0 $ 627.2 $ 499.5 $ 432.9 $ 354.4 $ 206.2 $ 123.4 Gross Leverage Ratio (4) 14.0 x 6.2 x 4.6 x 3.8 x 3.8 x 3.6 x 2.9 x 2.8 x Net Leverage Ratio (5) 7.5 x 2.9 x 1.9 x 1.2 x 1.1 x 0.8 x 0.4 x 0.3 x ____________________________________ (1) Trailing Twelve Month (“TTM”) Adjusted EBITDA is computed by summing our reported Adjusted EBITDA for the trailing four fiscal quarters. (2) Gross principal debt outstanding consists of the gross principal amount outstanding on Total debt, which excludes unamortized debt discount and issuance costs. (3) We define Gross principal debt outstanding, net of cash and cash equivalents as Gross principal debt outstanding less Cash and cash equivalents. (4) Our Gross Leverage Ratio is defined as Gross principal debt outstanding divided by our Trailing Twelve Month Adjusted EBITDA. (5) Our Net Leverage Ratio is defined as Gross principal debt outstanding, net of cash and cash equivalents divided by our Trailing Twelve Month Adjusted EBITDA. 34© Peloton 2012-2026, Peloton Interactive, Inc. All rights reserved.