Peloton’s stock shifts into reverse

Shares of Peloton backpedaled on Thursday after the connected-fitness company held its initial public offering amid skepticism about fastgrowing tech names.

Peloton stock opened at $27 — $2 below its IPO price of $29 — and headed down from there to eventually close 11 percent lower, at $25.76.

Peloton raised $1.16 billion through its public offering at a valuation of around $8 billion, and sold an additional $100 million in shares at the IPO price to an investor that had previously provided venture funding.

Peloton sells spinning bikes and treadmills that connect to the internet and have touch screens, along with subscription offerings that let users participate in virtual fitness classes.

A Peloton bike starts at $2,245, while a Peloton treadmill begins at $4,295.

Although Wall Street gave a generally warm reception to newly public companies with recurring revenue streams earlier in the year, sentiment has been weaker in recent months.

Peloton CFO Jill Woodworth said that the company noticed headlines expressing “concern about highgrowth tech companies and profitability” as Peloton embarked on its IPO roadshow

The company pays for a lot of its subscription-focused marketing expenses through the sale of its bikes.

“We obviously wish the stock traded better on the first day, but we’re in it for the long haul and are excited for capital to continue to grow our business,” Woodworth said.

She pointed to plans for new products and software as well as further international growth, as the company looks to expand into Germany soon.