Peloton will stop making their own bikes. $PTON is rising
Key notes:
In an effort to streamline its cost structure, Peloton Interactive said on Tuesday that it will only rely on partners to create bikes and treadmills.
Rexon, a Taiwanese firm that Peloton partnered with in October 2019, will take over as the hardware's primary manufacturer, while production at Tonic Fitness Technology, which Peloton had previously bought, will cease through the end of 2022.
According to Peloton CEO Barry McCarthy, “We anticipate that this, together with other initiatives, will enable us to continue reducing the cash strain on the business and increasing our flexibility.”
TL;DR PTON will stop manufacturing their bikes and are going to outsource it to some Taiwanese firm to streamline cost structure. Bullish or bearish in the long run?
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