Peloton Interactive Shares Soar On Five-year Partnership With Lululemon

(RTTNews) - Shares of Peloton Interactive Inc. (PTON) jumped more than 15% in after-hours trading after the fitness equipment maker announced a five-year strategic global partnership with Lululemon Athletica Inc. (LULU).

PTON closed Wednesday's regular trading at $4.65 up $0.03 or 0.64%. In the after-hours trading, the stock further gained $0.73 or 15.70%.

Under the strategic partnership, Peloton will become the exclusive digital fitness content provider for lululemon, and lululemon will become the primary athletic apparel partner to Peloton.

The companies noted that the brands will engage their global community of members in the United States, Canada, the United Kingdom, Germany and Australia through technical athletic apparel, real life experiences, special programming, and original content, expanding the brand awareness and reach for both companies. In addition, a select number of Peloton Instructors will become lululemon Ambassadors as part of the partnership.

Beginning October 11, 2023, co-branded apparel across lululemon's product lines will be available for purchase at Peloton retail stores and online at apparel.onepeloton.com in the US, UK, and CA (and in all five of Peloton's global markets by March 2024), lululemon said.

The co-branded apparel will be launched over the course of three new events that will be added to Peloton's already scheduled Peloton on Tour, starting with an activation in Chicago on October 5-7, 2023.

Starting on November 1, 2023, lululemon Studio All-Access Members will have access to thousands of Peloton classes for the same price they pay today, as Peloton becomes the exclusive provider of digital fitness content to lululemon Studio Members.

Peloton content will be updated on a weekly basis on the Studio device and companion app, with new Studio content produced by lululemon through Spring of next year. In addition, exclusive Peloton content will be available to people who sign up for lululemon's free Essential membership program, which currently has more than 13 million Members.

Lululemon noted that it intends to discontinue selling the lululemon Studio Mirror before the end of the year and will continue to provide ongoing service and support for Mirror devices.

lululemon will also discontinue its digital app-only membership tier on November 1, 2023, and current lululemon Studio app-only members will be offered an opportunity to become a Peloton App One Member.