On Thursday, Speede Fitness, a strength-training company that Hydrow’s competitor Peloton said had bought the majority stake in it by now due to growing sales as more fitness lovers opted for weights over cardio exercises.
Hydrow also announced that Bruce Smith, its CEO and founder would retire from executive office and that President and Chief Financial Officer John Stellato will take over. Meanwhile, Smith will become the chairman of Hydrow’s board of directors.
The company is best known for its expensive internet-connected rowing machines priced between $1,700 and $4,000 and is backed by heavyweight private equity such as Constitution Capital ad L Catterton. Also among the investors are some famous athletes and well-known people including Travis Kelce from Kansas City Chiefs, a team playing American football league (NFL) game and pop musician Justin Timberlake.
More than $300 million were raised by Hydro in fundraising efforts. The purchase was necessary to expand into weightlifting which has been one of the fastest developing segments within the industry of today’s fitness according to company officials.
This is coming at a time when those who love keeping fit have cut down on cardiovascular activities such as running or cycling instead favoring lifting dumbbells.
planet fitness In November, it said it was slowing down replacing cardio to save money in part.
“We have seen our members shift from mostly doing cardio workouts to wanting more strength training,” Planet Fitness CFO Thomas Fitzgerald told analysts on a call discussing third-quarter earnings citing low cost but hardly any for aerobic equipment. Our members want less cardio training.”
fitness for life These similar trends were reflected in an annual health survey conducted earlier this year. A total of 35% respondents named “building muscles” their top priority for 2024 which accounts for an increase by over 3% compared with last year
Speede Fitness creates a connected strength-training machine that somewhat resembles BowFlex incorporating advanced technologies like AI cameras, sensors, and even a large touch screen thereby making the experience more immersive.
According to Hydrow, “Strength training is one of the biggest markets in fitness, and Speede’s advanced technology outperforms existing products; this acquisition marks a significant milestone for both companies.” The boards of directors believe that this investment will facilitate Hydrow’s transformation into an inclusive healthcare organization with consumer goods to be launched next year.
Hydrow has made acquisitions and grown its sales unlike Peloton which have shrunk. Losing moneyPeloton is struggling to turn itself around. CNBC reported that during peak Covid pandemic times late last year, Peloton attempted buying Hydrow instead of creating its own rowing machine but was turned down by the latter. Peloton did not comment on CNBC’s request for comments.
On top of failing to meet expectations after another quarter was announced some private equity firms were looking at purchasing it now that it seems like Peloton could be up for sale. Declined revenuesSales fell according to CNBC on Tuesday.
However, Peloton recently posted losses as demand for its exercise equipment decreased with consumers buying fewer high-ticket items. Meanwhile, despite reducing its size steadily over time since it began trading publicly in October 2020, Hydrow has been expanding.
This year’s supply of hydrides connected rowing machines shopped off nearly 23% from the same time frame twelve months ago. Amazon had a 273% surge in sales during March ending 12 months when compared to the same period a year before (Reuters).
The advancement of Hydrow can make a person wonder whether the difficulties Peloton faces are due to its fitness market or weakness in broader home fitness sector. An internal error and a product missing an opportunity, too. It is crucial to note that the company mainly sold cardio machines, which went out of fashion with people, while it was encouraging members to concentrate on strength training. The firm says content for strength training is what really matters and not classes for cycling or running. For digital members, most popular course types it ranks second among members with Peloton hardware.
Peloton introduced a rowing machine called Peloton Row in September 2022 but largely ignored this $3,000 equipment.
an artificial intelligence device for home-guided strength training launched by Home team guide before it has received even less attention than the company’s rowing machines.
The Guide was mentioned in Peloton’s third quarter shareholder letter. The company took an approximately $9.1 million write-down on its product inventory.
