Peloton Launches New Product Line and Introduces AI System. The Stock Is Falling Sharply.

Five new exercise machines are available for purchase as of Wednesday. (Ezra Shaw/Getty Images)

Key Points

• Peloton Interactive launches a new product line including two bikes, two treadmills, and one rowing machine.
• The new products feature Peloton IQ, an AI and computer-vision system offering personalized guidance and feedback.
• Peloton shares fell after initially rising following the product line overhaul.

Peloton Interactive has overhauled its entire product line, complete with an artificial-intelligence and computer-vision system to provide personalized guidance to users.

The company launched its Cross Training Series on Wednesday, unveiling two stationary bikes and two treadmills, each with base and premium options, and one rowing machine. Prices range from $1,695 for the base Cross Training Bike to $6,695 for the Cross Training Tread+.

All devices are equipped with a new Peloton IQ system, which provides users feedback, insights, and tailored recommendations. Peloton IQ also will be available on existing Peloton-connected fitness equipment with a software update, the company said.

“This is the start of a new chapter for Peloton,” said CEO Peter Stern in a a statement. “This is more than an upgrade; it’s a relaunch.”

Peloton shares were falling 9% to $8.19 on Wednesday following the launch. They had traded higher in the premarket session.

The swift selloff may reflect a “buy the rumor, sell the news,” strategy, said Truist Securities analyst Youssef Squali, referring to investors adding to a position before an expected announcement and selling afterward.

Moving forward, shareholders are likely unsure about how the software and product updates might impact Peloton’s bottom line, said Susan Anderson of Canaccord Genuity.

“I think investors were positive on the software upgrade and the hardware but want to wait to see if it drives subscriber growth,” Anderson told Barron’s.

Peloton stock has plummeted from its all-time high closing price of $167.42 on Jan. 13, 2021.

Write to Nate Wolf at nate.wolf@barrons.com