1 00:00:02,520 --> 00:00:08,280 Speaker 1: Bloomberg Audio Studios, podcasts, radio news, the Bloomberg Tech Summit 2 00:00:08,280 --> 00:00:11,479 Speaker 1: in San Francisco. We have something specially on stage right now. 3 00:00:11,560 --> 00:00:13,600 Speaker 2: Yeah, let's head on over to the main stage because 4 00:00:13,640 --> 00:00:15,960 Speaker 2: we've got Peter Stern, the president and CEO of Peloton 5 00:00:16,000 --> 00:00:18,439 Speaker 2: Interactive in conversations happening right now. 6 00:00:18,560 --> 00:00:20,560 Speaker 1: It's with Bloomberg Technology s Marketermount. 7 00:00:20,800 --> 00:00:23,120 Speaker 3: A typical day for me is like this morning, getting 8 00:00:23,200 --> 00:00:25,439 Speaker 3: up and doing a little bit of cardio, ran to 9 00:00:25,520 --> 00:00:27,880 Speaker 3: the gym actually, and then did also some strength training, 10 00:00:28,760 --> 00:00:31,680 Speaker 3: and then I'm mostly spending my time working on those 11 00:00:31,680 --> 00:00:34,920 Speaker 3: twenty five initiatives with our team members, trying to find 12 00:00:34,960 --> 00:00:36,960 Speaker 3: how we can serve our members better. 13 00:00:37,720 --> 00:00:38,519 Speaker 1: And you know, if I. 14 00:00:38,440 --> 00:00:40,760 Speaker 3: Can spend my time on that kind of substance. 15 00:00:40,320 --> 00:00:41,320 Speaker 1: That's a really great day. 16 00:00:41,560 --> 00:00:43,400 Speaker 2: What are the top three of your twenty five? 17 00:00:44,240 --> 00:00:46,879 Speaker 3: So I'm not going to announce all of the you know, 18 00:00:46,960 --> 00:00:48,519 Speaker 3: all of the details of these sorts of things, but 19 00:00:48,560 --> 00:00:51,360 Speaker 3: then I'll tell you a little bit about the top one, 20 00:00:51,760 --> 00:00:54,960 Speaker 3: and that is that we have reignited the innovation engine 21 00:00:55,120 --> 00:00:58,959 Speaker 3: for us as a company, and so focusing on the 22 00:00:59,320 --> 00:01:03,440 Speaker 3: products and the experiences that we're going to offer over 23 00:01:03,480 --> 00:01:07,639 Speaker 3: the next few months is absolutely my number one. Another 24 00:01:07,640 --> 00:01:09,880 Speaker 3: one that I think is really important that we're focused 25 00:01:09,880 --> 00:01:15,280 Speaker 3: on is how we use AI to deliver personal experiences 26 00:01:16,040 --> 00:01:18,440 Speaker 3: for our members. That is another one I'm spending an 27 00:01:18,520 --> 00:01:20,600 Speaker 3: enormous amount of time on, so huge priority for us. 28 00:01:20,720 --> 00:01:22,360 Speaker 2: Talk to us a little bit more about that about 29 00:01:22,480 --> 00:01:26,120 Speaker 2: AI and what does the future fitness look like with 30 00:01:26,160 --> 00:01:27,160 Speaker 2: AI at its core. 31 00:01:27,600 --> 00:01:31,400 Speaker 1: So every member is different. 32 00:01:32,120 --> 00:01:36,160 Speaker 3: They all have different intents for why they choose to 33 00:01:36,200 --> 00:01:39,240 Speaker 3: become a member of Peloton. That can change over time. 34 00:01:39,400 --> 00:01:41,520 Speaker 3: So we need to not just get to know you, 35 00:01:41,560 --> 00:01:45,080 Speaker 3: but we need to evolve along with you. Every member 36 00:01:45,120 --> 00:01:48,040 Speaker 3: is different in terms of their baseline level of fitness, 37 00:01:48,880 --> 00:01:52,560 Speaker 3: their level of commitment, their level of confidence, and so 38 00:01:54,200 --> 00:01:57,600 Speaker 3: one of the things that I really value is the 39 00:01:57,680 --> 00:02:01,160 Speaker 3: human coaching that are amazing instructors. 40 00:02:00,720 --> 00:02:01,840 Speaker 1: Provide at Peloton. 41 00:02:02,240 --> 00:02:04,800 Speaker 3: But I want to find ways to scale them by 42 00:02:04,840 --> 00:02:08,880 Speaker 3: creating individualized programs for each of our members so that 43 00:02:08,880 --> 00:02:11,760 Speaker 3: they can get the right class from the right instructor 44 00:02:11,880 --> 00:02:15,040 Speaker 3: that's personalized for them. A really simple example of how 45 00:02:15,040 --> 00:02:18,480 Speaker 3: we're doing it right now is that we do something 46 00:02:18,520 --> 00:02:21,600 Speaker 3: called power zones on bike, or we do paste targets 47 00:02:21,639 --> 00:02:26,680 Speaker 3: on tread where we actually set individualized speeds or levels 48 00:02:26,680 --> 00:02:29,760 Speaker 3: of effort for each of our members. But then we've 49 00:02:29,840 --> 00:02:34,080 Speaker 3: introduced a new set of features called personalized plans, and 50 00:02:34,120 --> 00:02:36,600 Speaker 3: we've had at this point over six hundred thousand of 51 00:02:36,600 --> 00:02:40,280 Speaker 3: our members have started a personalized plan, and the system 52 00:02:40,320 --> 00:02:44,120 Speaker 3: basically understands your goals and then builds a plan out 53 00:02:44,200 --> 00:02:47,200 Speaker 3: for you, and we deliver real results with these sorts 54 00:02:47,200 --> 00:02:49,400 Speaker 3: of things. So just to give you an example of 55 00:02:49,400 --> 00:02:51,720 Speaker 3: how this stuff really does make a difference. 56 00:02:51,919 --> 00:02:57,880 Speaker 1: For example, when one of our members buys a treadmill, within. 57 00:02:57,680 --> 00:03:01,120 Speaker 3: The first four weeks of using the treadmill, we're on 58 00:03:01,240 --> 00:03:04,600 Speaker 3: average reducing their mild time by thirty seconds. So we 59 00:03:04,600 --> 00:03:08,160 Speaker 3: can make real differences in somebody's conditioning and that translates 60 00:03:08,360 --> 00:03:11,359 Speaker 3: not just into more confidence and better performance as an athlete, 61 00:03:11,480 --> 00:03:13,080 Speaker 3: it translates into a longer life. 62 00:03:13,600 --> 00:03:14,640 Speaker 1: What about data. 63 00:03:14,360 --> 00:03:17,959 Speaker 2: Collections, you can get some more information about the user 64 00:03:18,120 --> 00:03:20,359 Speaker 2: and then use AI to optimize their workouts. Do you 65 00:03:20,440 --> 00:03:23,320 Speaker 2: need a wearable, do you need a new heart rate strap? 66 00:03:23,360 --> 00:03:26,600 Speaker 2: Do you need more sensors on the treads and bikes themselves. 67 00:03:27,000 --> 00:03:30,400 Speaker 3: Yeah, we're very lucky in this regard in that our 68 00:03:30,440 --> 00:03:32,720 Speaker 3: members are doing a lot of that hard work for us. 69 00:03:33,200 --> 00:03:37,240 Speaker 3: So we have a great partnership with Google Fitbit. For example, 70 00:03:37,680 --> 00:03:42,040 Speaker 3: we have done integration with Garman smart watches because a 71 00:03:42,040 --> 00:03:47,440 Speaker 3: lot of top athletes choose that, And we also are 72 00:03:47,480 --> 00:03:49,960 Speaker 3: working with the Apple Health app to make sure that 73 00:03:49,960 --> 00:03:51,240 Speaker 3: we can import data from there. 74 00:03:51,400 --> 00:03:53,280 Speaker 1: A very large fraction of our members have. 75 00:03:53,240 --> 00:03:57,360 Speaker 3: An Apple Watch, and that Apple Health app basically can 76 00:03:57,400 --> 00:04:00,880 Speaker 3: act for many members as basically a Rosetta stone for us, 77 00:04:01,200 --> 00:04:03,200 Speaker 3: allowing us to get access to the data that we 78 00:04:03,240 --> 00:04:07,120 Speaker 3: need with the permission of the member. Once we have 79 00:04:07,240 --> 00:04:10,480 Speaker 3: that data, now we can use the third party information 80 00:04:11,000 --> 00:04:14,080 Speaker 3: that our members are providing us. But we have such 81 00:04:14,280 --> 00:04:18,040 Speaker 3: rich first party information on our members as well, based 82 00:04:18,040 --> 00:04:21,240 Speaker 3: on the workouts that they're doing on our machines and 83 00:04:21,240 --> 00:04:23,640 Speaker 3: how much they're pushing themselves. If they have a watch, 84 00:04:23,720 --> 00:04:25,920 Speaker 3: we can look at their heart rate and we can 85 00:04:26,240 --> 00:04:30,720 Speaker 3: impute then how much effort they're expending. And if they 86 00:04:30,720 --> 00:04:32,919 Speaker 3: don't have a watch, we can basically compare them with 87 00:04:32,960 --> 00:04:35,640 Speaker 3: members who do have one, and so we can basically 88 00:04:36,680 --> 00:04:40,159 Speaker 3: determine how hard you're working, and we can, for example, 89 00:04:40,200 --> 00:04:42,520 Speaker 3: calculate things like a cardio fitness score. 90 00:04:43,160 --> 00:04:44,960 Speaker 1: So I'm really excited about how we'll be able to 91 00:04:45,040 --> 00:04:45,720 Speaker 1: use data. 92 00:04:45,520 --> 00:04:48,840 Speaker 3: To deliver ever more personalized experiences for our members. 93 00:04:49,160 --> 00:04:51,480 Speaker 2: So you said you did a workout this morning. Obviously 94 00:04:51,600 --> 00:04:54,000 Speaker 2: pelotons based in New York, so you're here probably stayed 95 00:04:54,000 --> 00:04:58,320 Speaker 2: in a hotel. How important is the hotel business in 96 00:04:58,360 --> 00:05:03,640 Speaker 2: the gym business to Peloton under Peter Stern in compare 97 00:05:03,680 --> 00:05:06,000 Speaker 2: it to the someone buys one for their home business. 98 00:05:06,680 --> 00:05:11,120 Speaker 3: So the nice thing about this is these are not 99 00:05:11,279 --> 00:05:13,840 Speaker 3: either or situations. I think it might have been perceived 100 00:05:13,839 --> 00:05:16,479 Speaker 3: that way in the past, but it's absolutely not. Let's 101 00:05:16,520 --> 00:05:20,240 Speaker 3: take travelers in hotels as an example. If you're the 102 00:05:20,320 --> 00:05:23,159 Speaker 3: type of person who is in a hotel, then you're 103 00:05:23,320 --> 00:05:27,120 Speaker 3: a person who is investing in yourself. You have some 104 00:05:27,200 --> 00:05:30,200 Speaker 3: ability to pay for a service, and you're going to 105 00:05:30,200 --> 00:05:33,600 Speaker 3: a hotel gym. You are really committed to taking care 106 00:05:33,640 --> 00:05:35,880 Speaker 3: of yourself. That is a situation where we should have 107 00:05:35,920 --> 00:05:38,920 Speaker 3: Peloton equipment everywhere. I'm really happy with the partnerships we 108 00:05:39,000 --> 00:05:43,480 Speaker 3: have right now with Hilton and with Hyatt, where we 109 00:05:43,560 --> 00:05:47,480 Speaker 3: have peloton equipment in most of their gyms. I do 110 00:05:47,520 --> 00:05:50,520 Speaker 3: think in hotel gyms, basically, peloton equipment should be a 111 00:05:50,640 --> 00:05:53,000 Speaker 3: must have amenity. It's the sort of thing where you 112 00:05:53,000 --> 00:05:55,039 Speaker 3: shouldn't even choose. You wouldn't even want to stay in 113 00:05:55,040 --> 00:05:58,320 Speaker 3: the hotel if it doesn't have the Peloton equipment that 114 00:05:58,400 --> 00:06:01,039 Speaker 3: you count on having at home. And then that's a 115 00:06:01,040 --> 00:06:04,279 Speaker 3: great way for us to meet new members because you know, 116 00:06:04,320 --> 00:06:05,840 Speaker 3: some people might not have had a chance to try 117 00:06:05,839 --> 00:06:07,960 Speaker 3: our equipment out, but while you're traveling at a hotel 118 00:06:08,000 --> 00:06:09,440 Speaker 3: gym where you've got a little time on your hands, 119 00:06:09,440 --> 00:06:10,640 Speaker 3: that's a great way to do it. 120 00:06:11,000 --> 00:06:12,360 Speaker 1: Now, with regard to. 121 00:06:14,000 --> 00:06:18,280 Speaker 3: Commercial gyms, there's also tremendous opportunities there. We have a 122 00:06:18,360 --> 00:06:21,280 Speaker 3: number of pilots taking place with all sorts of gyms, 123 00:06:21,320 --> 00:06:23,640 Speaker 3: including the y so we can try to make Peloton 124 00:06:23,680 --> 00:06:27,280 Speaker 3: equipment as accessible as possible. But one of the things 125 00:06:27,279 --> 00:06:30,359 Speaker 3: that I'm really excited about, and this is, you know, 126 00:06:30,400 --> 00:06:31,159 Speaker 3: this is not something that. 127 00:06:31,160 --> 00:06:33,960 Speaker 1: We've we've really talked about publicly before. 128 00:06:34,400 --> 00:06:36,240 Speaker 3: Not a lot of people know that we own pre 129 00:06:36,279 --> 00:06:40,000 Speaker 3: corep which is one of the leading providers of equipment 130 00:06:40,160 --> 00:06:41,160 Speaker 3: to gyms everywhere. 131 00:06:41,400 --> 00:06:43,359 Speaker 1: We are bringing pre Corp in. 132 00:06:43,480 --> 00:06:47,960 Speaker 3: To basically be the lead partner in a commercial operating 133 00:06:48,000 --> 00:06:51,200 Speaker 3: division for Peloton, and the pre Core business has the 134 00:06:51,360 --> 00:06:57,080 Speaker 3: skills to be able to install and service equipment. 135 00:06:56,720 --> 00:07:00,600 Speaker 1: To the exacting standards of gym operators who have very 136 00:07:00,640 --> 00:07:01,839 Speaker 1: heavy duty cycle. 137 00:07:01,680 --> 00:07:03,720 Speaker 3: On that type of equipment, and so we're gonna be 138 00:07:03,720 --> 00:07:07,200 Speaker 3: able to bring Peloton equipment into more gyms with the 139 00:07:07,240 --> 00:07:10,640 Speaker 3: capabilities of pre Core. At the same time, we're now 140 00:07:10,640 --> 00:07:16,559 Speaker 3: bringing Peloton workouts onto pre Core equipment, which will really 141 00:07:17,000 --> 00:07:19,840 Speaker 3: differentiate that pre Core equipment in the minds of gym 142 00:07:19,880 --> 00:07:23,200 Speaker 3: operators and hopefully open up even more new audiences for them. 143 00:07:23,720 --> 00:07:25,720 Speaker 1: So, you know, I would basically say this. 144 00:07:25,640 --> 00:07:28,320 Speaker 3: Is a long overdue post merger integration that we're doing 145 00:07:28,320 --> 00:07:30,280 Speaker 3: with pre Core and making it the foundation for our 146 00:07:30,280 --> 00:07:31,280 Speaker 3: commercial business. 147 00:07:31,760 --> 00:07:34,880 Speaker 2: How do most people buy a Peloton right? Are they 148 00:07:34,960 --> 00:07:38,040 Speaker 2: subscribing to it with your rental program, are they doing installments? 149 00:07:38,040 --> 00:07:39,200 Speaker 1: Are they buying it out right? 150 00:07:39,480 --> 00:07:41,960 Speaker 2: And then earlier this week you launched a new program 151 00:07:42,400 --> 00:07:45,640 Speaker 2: sort of a resale website, like a Craigslist for Peloton. 152 00:07:45,680 --> 00:07:47,600 Speaker 1: I guess you can call it. Talk to us about that, I. 153 00:07:47,560 --> 00:07:51,160 Speaker 3: Would say, Actually, so the two largest channels are people 154 00:07:51,160 --> 00:07:53,680 Speaker 3: buying a Peloton equipment from our website. You go to 155 00:07:53,720 --> 00:07:55,960 Speaker 3: one Peloton dot com and it's all there, and it's 156 00:07:55,960 --> 00:07:57,240 Speaker 3: a really great way to buy it. 157 00:07:58,040 --> 00:07:59,880 Speaker 1: But one of them. 158 00:08:00,040 --> 00:08:02,800 Speaker 3: Ourgest ways for us to acquire new members is in 159 00:08:02,840 --> 00:08:04,040 Speaker 3: the secondhand market. 160 00:08:04,360 --> 00:08:06,920 Speaker 1: So you raised mark. 161 00:08:06,520 --> 00:08:08,360 Speaker 3: This announcement that we had a couple days ago about 162 00:08:08,360 --> 00:08:12,400 Speaker 3: something called Repowered, and the idea here is that there 163 00:08:12,400 --> 00:08:15,440 Speaker 3: are lots of Peloton bikes in particular that are out 164 00:08:15,480 --> 00:08:18,080 Speaker 3: there in the world that are being underutilized and that 165 00:08:18,080 --> 00:08:21,000 Speaker 3: does no one any good. I'd love for people to 166 00:08:21,040 --> 00:08:23,200 Speaker 3: get back on the bike. It's the right thing for them. 167 00:08:23,360 --> 00:08:25,960 Speaker 3: Certainly it's great for us as a company. But if 168 00:08:26,000 --> 00:08:28,160 Speaker 3: you're not going to use a Peloton bike, we want 169 00:08:28,160 --> 00:08:29,760 Speaker 3: to make it really easy for you to get that 170 00:08:29,800 --> 00:08:30,960 Speaker 3: into the hands of someone who. 171 00:08:30,880 --> 00:08:34,120 Speaker 1: Will love it. And historically that's taken. 172 00:08:33,880 --> 00:08:37,480 Speaker 3: Place, for example, on Facebook marketplace, and that's absolutely fine 173 00:08:37,480 --> 00:08:38,280 Speaker 3: for people who want. 174 00:08:38,120 --> 00:08:40,600 Speaker 1: To do that, but it means that you. 175 00:08:39,880 --> 00:08:42,920 Speaker 3: Need to transact with a stranger on both ends and 176 00:08:42,960 --> 00:08:46,280 Speaker 3: potentially have the stranger come into your home. And so 177 00:08:46,440 --> 00:08:48,600 Speaker 3: what we're trying to do is streamline that and deliver 178 00:08:48,640 --> 00:08:52,319 Speaker 3: a more premium experience for those secondhand customers. 179 00:08:52,960 --> 00:08:53,920 Speaker 1: What this does is. 180 00:08:53,920 --> 00:08:56,720 Speaker 3: It allows us to get our bikes that are built 181 00:08:56,760 --> 00:08:59,079 Speaker 3: to last into the hands of people who will love 182 00:08:59,120 --> 00:09:01,880 Speaker 3: it at a price. It's a fraction of a new bike, 183 00:09:03,120 --> 00:09:05,040 Speaker 3: and there's no capital. 184 00:09:04,679 --> 00:09:06,120 Speaker 1: Expenditure for us as a company. 185 00:09:06,200 --> 00:09:10,160 Speaker 3: There's no environmental impact associated with producing those bikes because 186 00:09:10,200 --> 00:09:12,040 Speaker 3: they're already out there in the world, and so it's 187 00:09:12,080 --> 00:09:13,760 Speaker 3: a great way to help somebody get fit. 188 00:09:13,880 --> 00:09:16,680 Speaker 1: And you know, grow our business. 189 00:09:17,360 --> 00:09:21,880 Speaker 2: Last question for you, Peloton standalone business for years to come? 190 00:09:22,320 --> 00:09:25,960 Speaker 2: Is it potentially an acquisition target for a larger company. 191 00:09:26,640 --> 00:09:28,800 Speaker 1: What do you see as the You know, I was 192 00:09:28,880 --> 00:09:31,160 Speaker 1: not hired to sell this company. 193 00:09:31,440 --> 00:09:33,800 Speaker 3: I was hired to bring this company back to growth, 194 00:09:34,000 --> 00:09:36,040 Speaker 3: to reinvigorate it, and it is happening. 195 00:09:36,400 --> 00:09:40,520 Speaker 1: So there is we are. We are a standalone company 196 00:09:40,520 --> 00:09:42,000 Speaker 1: for years to come. Great. 197 00:09:42,120 --> 00:09:43,960 Speaker 2: Thank you, Peter Stern, thanks for having me Mark. 198 00:09:47,920 --> 00:09:50,640 Speaker 1: All right, everyone, you've been listening to a live conversation 199 00:09:50,760 --> 00:09:53,280 Speaker 1: between our Mark German and of course Peter Stern, who 200 00:09:53,320 --> 00:09:55,960 Speaker 1: is the president and CEO of a Peloton Interactive