Peloton's stock surged. The company released its cheapest treadmill ever.

Shares of Peloton Interactive, a mid-cap fitness equipment retailer, rose 1.5% on the Nasdaq on September 22. The company, which has traditionally been known for its premium product prices, announced the release of the most affordable treadmill in its history. “All of this is aimed at making us as well-known in running as we are in cycling,” Peloton CEO Peter Stern said in an interview with Yahoo Finance.

Peloton's stock price rose 1.5% on September 22, to $5. In premarket trading on September 23, it continued to rise slightly.

This came after the company announced the launch of three treadmill models. The Tread Flex—Peloton’s first foldable treadmill and the cheapest in the company’s history—is the flagship product in the lineup, according to the press release. It will cost $2,195, which is $1,100 less than the manufacturer’s previous most affordable model, according to Barron’s.

The Tread Flex opens up “entirely new market opportunities” for the company, Peloton CEO Peter Stern said in an interview with Yahoo Finance. Two other models—the Peloton Tread Vision and the Peloton Tread+ Vision—are capable of tracking the user’s movements. In addition, the Tread+ Vision is equipped with the AI-powered Peloton IQ feature for personalized feedback.

“We’re seeing a real surge in interest in running: the number of marathon runners and running clubs is growing. [...] So all of this is aimed at making us as well-known in running as we are in cycling,” Stern said.

Investors are likely hoping that the introduction of a cheaper model will help Peloton boost demand for its products, according to Barron’s. The company’s business boomed during the lockdowns of the coronavirus pandemic. But as lockdowns ended and people returned to gyms, sales fell. This has affected Peloton’s revenue, which has declined annually from its peak of $4.02 billion in fiscal year 2021 (ended June 30, 2021), Barron’s notes.

To address this, Peloton unveiled a restructuring plan in May 2024 and appointed Stern as CEO. Since then, the company has developed an innovation strategy in the field of artificial intelligence, released an updated line of exercise machines featuring the integrated AI and computer vision system Peloton IQ, partnered with the streaming service Spotify, and announced the acquisition of the Pilates startup Skōp.

Despite this, the company’s revenue fell by 2% to $2.4 billion at the end of fiscal year 2026. At the same time, it managed to post a net profit “for the first time in a full year” ($63.2 million compared with a loss of $118.9 million in fiscal year 2025), Stern said. The revenue forecast for the current fiscal year also calls for a decline of approximately 3.9%.

Since the beginning of the year, Peloton's stock price has plummeted by 18.5%.

Wall Street, on the whole, is not particularly optimistic about the company’s prospects: its stock has nine “hold” ratings, the same number of “buy” ratings, and two “sell” ratings. The average price target of $7.90 implies 58% upside potential from the last closing price.