Core Viewpoint - Peloton Interactive Inc. shares experienced a significant decline after the company issued a weaker-than-expected revenue forecast for the fiscal third quarter, disappointing investors who anticipated a turnaround following a recent hardware revamp [1]. Financial Performance - Revenue for the fiscal third quarter is projected to be between $605 million and $625 million, representing a 1% decline from the previous year and falling short of the average estimate of $637 million [2]. - The revenue outlook for the fiscal year ending in June has been reduced to a maximum of $2.44 billion, indicating a 3% drop and again missing Wall Street expectations [2]. Stock Performance - Peloton shares plummeted 26% to close at $4.39, marking the steepest same-day decline since November 2021. The stock has now decreased approximately 29% year-to-date, following a similar decline of 29% in 2022 [3]. Product Strategy - The company launched a new line of AI-powered treadmills, bikes, and other products last fall, which was expected to drive a turnaround. This marked the first significant hardware overhaul in years under new CEO Peter Stern [4]. - However, the latest offerings have not sold as well as anticipated, leading to a 3% decline in sales during the December quarter, totaling $656.5 million [4]. Market Conditions - Despite some improvements in profitability and cost efficiencies, there remains uncertainty regarding whether Peloton's new strategy can effectively boost hardware sales and restore sustained consumer demand, particularly in a softer U.S. connected fitness market [5]. - The new product lineup, which included price increases for hardware and subscription plans, had a slow sales start [5]. Consumer Behavior - The company noted a lengthy consideration period for consumers purchasing their products, viewing this as an opportunity. Existing members are primarily buying additional equipment rather than replacing older devices [6].