Peloton, the interactive fitness company that makes treadmills and spin bikes, now has one of the biggest stars in the world on its payroll — Beyoncé.
The company announced a multiyear deal with the singer on Tuesday that will include a curated series of themed workouts across all categories offered on the Peloton app, including cycling, running, strength, bootcamp, yoga and meditation. Financial terms of the deal were not disclosed.
“Peloton and I both believe that the power of music can help uplift, motivate and inspire those on their fitness journeys,” Beyoncé said in a statement. “I’ve been a Peloton member for several years, and I’m excited to partner with a company that helps people, young and old, be the best versions of themselves, in an innovative and adaptable way.”
Beyoncé is the most requested artist by its community of more than 3.6 million members, according to Peloton, making the partnership a natural fit. Peloton and Beyoncé also announced plans to give free two-year digital memberships to students at 10 historically Black colleges and universities and said it will commit to building long-term recruiting partnerships with those schools to bring in new talent.
“Previously they didn’t carry her music, so this is going to extend what is already a competitive advantage for Peloton. The depth of their music catalog extends that advantage further,” said James Hardiman, managing director at Wedbush Securities analysts.
Of course, everything Beyoncé does is a hit and the latest deal is no exception. Shares of Peloton surged 8 percent on Tuesday after the partnership announcement.
Or as one Twitter user put it: “Peloton market cap went up $2.5 billion in the last 3 hours of announcing deal with Beyoncé.”
Peloton promoted the classes in an email and push alert to its app subscribers.
“Work wise, this week has been and will continue to be insane. Personally, I’m still elated about the Beyoncé Peloton partnership,” one person wrote on Twitter.
“Gotta take those nuggets of joy when you find em in these times,” another user added.
In February, Peloton settled a lawsuit filed by the National Music Publishers’ Association that could have jeopardized the fitness company’s music playlists, an essential part of class. As part of the agreement, Peloton and the trade association agreed to a “joint collaboration agreement and will work together to further optimize Peloton’s music-licensing systems and processes.”
The following month, Peloton’s business boomed due to the coronavirus pandemic. After gyms closed during quarantine, Peloton had a surge in sales from people looking for an alternative way to work out at home. In some locations, the company scrambled to keep up with demand and had a waitlist stretching more than 10 weeks for its indoor cycles.
Peloton cut the price of its most popular spin bike by $350 in September to make it more accessible. The standard bike now costs $1,895. Peloton also debuted a premium Bike+ with added features, such as a rotating touchscreen and four-speaker sound system. A new lower-priced treadmill will also be available for $2,495 early next year, offering an alternative to Peloton’s premium $4,295 product.
After going from strength to strength this year, the company faced its first major test on Monday when shares dropped 20 percent on the upbeat news that Pfizer has a vaccine that in early trials shows a 90 percent efficacy rate in protecting people against the coronavirus.
While the stock is rebounding, Hardiman said he thinks Peloton has long-term potential, even after a vaccine is distributed.
“Peloton’s future remains bright,” he said. “I have been a long-time believer there is going to be a long and significant shift away from traditional gyms and toward at-home fitness, and Peloton remains the best-positioned company to capitalize on that.”