Peloton Interactive Inc gross margin has been in long-term decline. The average rate of decline per year is -3.6%.
The historical rank and industry rank for Peloton Interactive's Gross Margin % or its related term are showing as below:
PTON'
s Gross Margin % Range Over the Past 10 Years
Min: 19.5 Med: 39.04 Max: 45.88
Current: 45.52
During the past 8 years, the highestGross Margin % of Peloton Interactive was 45.88%. The lowest was 19.50%. And the median was 39.04%.
PTON's Gross Margin % is ranked better than 53% of 766
companies
in the Travel & Leisure industry
Industry Median: 43.675
vs PTON: 45.52
Peloton Interactive had a gross margin of 51.85% for the quarter that ended in Sep. 2024 => Durable competitive advantage
The 5-Year average Growth Rate of Gross Margin for Peloton Interactive was -3.60% per year.
Peloton Interactive Gross Margin % Historical Data
The historical data trend for Peloton Interactive's Gross Margin % can be seen below:
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
Competitive Comparison of Peloton Interactive's Gross Margin %
For the Leisure subindustry, Peloton Interactive's Gross Margin %, along with its competitors' market caps and Gross Margin % data, can be viewed below:
* Competitive companies are chosen from companies within the same industry, with headquarter located in same country, with closest market capitalization; x-axis shows the market cap, and y-axis shows the term value; the bigger the dot, the larger the market cap. Note that "N/A" values will not show up in the chart.
Peloton Interactive's Gross Margin % Distribution in the Travel & Leisure Industry
For the Travel & Leisure industry and Consumer Cyclical sector, Peloton Interactive's Gross Margin % distribution charts can be found below:
* The bar in red indicates where Peloton Interactive's Gross Margin % falls into.
* For Operating Data section: All numbers are indicated by the unit behind each term and all currency related amount are in USD. * For other sections: All numbers are in millions except for per share data, ratio, and percentage. All currency related amount are indicated in the company's associated stock exchange currency.
A positive Gross Profit is only the first step for a company to make a net profit. The gross profit needs to be big enough to also cover related labor, equipment, rental, marketing/advertising, research and development and a lot of other costs in selling the products.
Warren Buffett believes that firms with excellent long term economics tend to have consistently higher margins.
Durable competitive advantage creates a high Gross Margin % because of the freedom to price in excess of cost. Companies can be categorized by their Gross Margin %
1. Greater than 40% = Durable competitive advantage
2. Less than 40% = Competition eroding margins
3. Less than 20% = no sustainable competitive advantage
Consistency of Gross Margin is key
Peloton Interactive had a gross margin of 51.85% for the quarter that ended in Sep. 2024 => Durable competitive advantage
Be Aware
If a company loses its competitive advantages, usually its gross margin declines well before its sales declines. Watching Gross Margin % and Operating Margin % closely helps avoid value trap situations.
Peloton Interactive Gross Margin % Related Terms
Thank you for viewing the detailed overview of Peloton Interactive's Gross Margin % provided by GuruFocus.com. Please click on the following links to see related term pages.
Peloton Interactive Inc operates an interactive fitness platform. It operates its business in two reportable segments: Connected Fitness Products and Subscription. Connected Fitness Product revenue consists of bike and tread and related accessories sales, associated fees for delivery and installation, and extended warranty agreements. Subscription revenue is generated from monthly Connected Fitness Subscription and Digital Subscription. The company generates maximum revenue from the Subscription segment. Geographically, the company derives a majority of its revenue from North America and the rest from the International markets.
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