Peloton CEO and president Barry McCarthy began his shareholder letter by noting “significant progress” in the company’s comeback despite its losses.

The connected fitness company reported a 28% year-over-year decline in Q4 revenue to $678.7 million, falling short of estimates of $718.2 million. 

• Revenue from the company’s connected fitness products fell 55% year-over-year to $295.6 million. The segment includes contributions from Precor, which Peloton acquired for $420 million last year.
• Subscription revenue increased 36% to $383.1 million. Peloton ended the quarter with 2.97 million connected fitness subscriptions.

Peloton’s net loss reached $1.24 billion, more than three times the $313.2 million net loss posted during the same period last year. 

Peloton posted an operating loss of $1.2 billion, with $415 million related to restructuring charges. The company announced 2,800 job cuts and an $800 million restructuring plan in February. Earlier this month, it revealed another 784 jobs would be eliminated, as well as a reduction in the number of store locations.

Peloton’s Comeback

In Q4, Peloton released its first connected strength offering, the Peloton Guide, and expects to launch a connected rowing machine by the “holiday season.” 

On Wednesday, it announced Amazon would begin selling select products, marking Peloton’s first time teaming up with another retailer. 

Earlier this month, Peloton increased prices for its Bike+ and Tread.

Peloton expects first-quarter revenue between $625 million and $650 million, with subscribers staying flat. The company did not provide a financial outlook for FY2023.

Historically black colleges and universities across the country are starting to cash in on the popularity and expensive media rights deals of college football’s blue-chip programs. 

Some of the most storied programs have sought out HBCUs to fill holes in game schedules for upcoming seasons, which has provided lucrative opportunities and brand exposure for HBCUs.

“The revenue we’ll be generating will be huge,” said North Carolina Central University athletic director Louis Perkins. “I don’t want to say it’s essential for our survival, but it’s very, very important.” 

HBCUs, which enter these games as heavy underdogs, are handed big checks via game guarantees. 

• Tennessee State will earn $1 million to play Notre Dame on Sept. 2, 2023, in South Bend.
• UCLA will pay Alabama State $590,000 for a game on Sept. 10, 2022, at the Rose Bowl. 
• The Bruins will also pay NC Central $700,000 for a game on Sept. 16, 2023, at the Rose Bowl. 

More Opportunity

HBCUs have recently gained more notoriety in college football as NFL legends Eddie George and Deion Sanders have joined the coaching ranks at Tennessee State and Jackson State, respectively — and big brands and companies are also taking notice.

Earlier this month, CBS announced a deal with Allen Media Group’s HBCU Go — the largest broadcaster for sports at HBCUs — while Jordan Brand secured a 20-year pact with Howard University, one of the country’s most prestigious HBCUs.

Hibbett, Inc. posted unfavorable results in the company’s latest earnings report. 

The athletic apparel retailer generated $392.8 million in net sales in fiscal Q2 2023 — a 6.3% decline from $419.3 million for the same period last year. The lackluster sales were attributed to inflationary pressures and supply chain constraints due to increased freight costs. 

• Comparable sales fell 9.2% during the quarter compared to Q2 2022.
• In Q2 2023, brick-and-mortar comparable sales declined 11.9% year-over-year.
• E-commerce sales — which made up 15% of total sales — increased 8.3% in fiscal Q2. 

Hibbett, which projects better results in fiscal Q3 due to back-to-school sales, failed to meet Wall Street earnings estimates of $2.26 in Q2, with a profit of $1.86 per share. 

The company reported a net income of $24.7 million during the quarter, down from a net income of $46.7 million in Q2 2022 — when shares earned $2.86 apiece.

Positive Outlook

Hibbett improved its inventory position during the second quarter in anticipation of back-to- school sales. The Alabama-based company reported an inventory of $366.2 million as of July 30, up 68.9% compared to Q2 2021 and a 66.5% increase from the first quarter of FY2023.

Hibbett — which operates 1,117 Hibbett and City Gear stores across 36 states — has raised its full-year outlook despite the underwhelming Q2. The company expects net sales to increase in “the low-single-digit range” compared to FY2022.