Thinking of buying a secondhand Peloton machine? Well, US and Canadian customers who do will now have to pay a one-time $95 (or $125 CAD) “used equipment activation fee.”
Peloton made the announcement in its Q4 2024 shareholder letter. The fee doesn’t apply to refurbished models you buy directly from Peloton or its third-party distribution partners. The company clarified in an earnings call that this fee will be applied to folks who buy a Peloton machine directly from a previous owner.
The official reason why is so that new members “receive the same high-quality onboarding experience Peloton is known for.” That may be true, but the fee is also a way for Peloton to get a cut of secondary hardware sales. In today’s earnings call, the company itself said that the fee will also be a “source of incremental revenue and gross profit.” For users, the fee will include a virtual custom fitting for Bike and Bike Plus customers, as well as a history summary of the pre-owned hardware. Peloton says it’ll also extend discounts on bike shoes, mats, and spare parts.
The obvious appeal of buying a Peloton from a secondhand is the savings. On Facebook Marketplace, you can easily find used Peloton Bikes in the $300–$500 range. (The regular Bike retails for $1,445.) There are also private Facebook Groups like Peloton Buy Sell Trade that are popular within the community. Secondhand buyers still have to pay a $44 monthly membership fee to access Peloton’s content, but the initial savings are substantial given that Peloton hardware is expensive for the category.
Otherwise, Peloton’s earnings call was more hopeful than its last, which saw CEO Barry McCarthy step down amid another round of layoffs. Peloton shares rose more than 15 percent as the company showed signs that efforts to reverse its poor fortunes were taking hold, recording modest sales growth and narrowing its losses to $30 million, down from $241 million year over year.