Once rivals, now partners: Peloton and Lululemon to collaborate on connected fitness and apparel
FILE - This is the sign on a Lululemon store in Pittsburgh on Monday, Jan. 30, 2023. Interactive fitness company Peloton and athletic wear maker Lululemon have announced a five-year partnership, Thursday, Sept. 28, effectively closing the curtain on Lululemon’s recently acquired connected fitness device, Mirror.(AP Photo/Gene J. Puskar, File)
Peloton and athletic wear maker Lululemon have announced a five-year partnership, effectively closing the curtain on Lululemon’s recently acquired connected fitness device, Mirror.
The interactive fitness company steps in to become the exclusive digital fitness content provider for Lululemon, which in turn becomes the primary athletic apparel partner to New York-based Peloton.
Vancouver, British Columbia-based Lululemon, known in its early days for mostly making yoga gear, broadened its athletic apparel offerings and then bought at-home exercise startup Mirror for $500 million in June of 2020, just months into the COVID-19 pandemic.
Lululemon’s challenge to Peloton in the connected fitness arena was short-lived. Lululemon said Wednesday that it would discontinue selling Mirror before the end of the year but would continue to provide service and support to users.
Mirror, which launched in 2018, sold a $1,500 interactive, 56-inch tall screen that streamed live and on-demand workout classes as well as immersive one-on-one personal training.
Beginning next month, Peloton retail and online stores will begin selling co-branded Lululemon apparel. In November, Lululemon studio all-access subscribers will be able to take Peloton classes for the same price they currently pay for Mirror offerings.
Peloton enjoyed incredible sales growth during the height of the coronavirus pandemic and its share price multiplied by more than five times in 2020 amid lockdowns. But sales of its pricey bikes and treadmills began to slow in 2021 as vaccines gave people more freedom to get out of their homes, including visits to the gym.
Early in 2022, CEO Barry McCarthy replaced Peloton founder John Foley to right a business that has had numerous stumbles, from marketing missteps to recalls. This spring, the company announced a significant rebrand, shedding its identity as a seller of luxury exercise bikes and equipment while shifting toward an image of a more inclusive health technology company.
Peloton shares rose about 2% Wednesday morning after jumping as much as 15% in off-hours trading after the partnership was announced late Wednesday. Trading at less than $5 per share early Thursday, they have lost about three-quarters of their value from 2023 highs of close to $18 in February. Shares peaked at around $171 each in early 2021.
Shares of Lululemon ticked down less than a quarter of one percent, to $378.30 in morning trading.