Peloton Claims Apple’s New Privacy Rule Is Causing It to Lose Subscribers
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If you are a Peloton owner, then you know just how large the Peloton community is. The company has changed the game of at-home fitness equipment, and people are eager to get their hands on one of their stationary bikes. Still, just like any company, it is focused on growth. And, unfortunately, that growth is being impacted negatively by Apple’s iOS ad-related privacy changes.
During Peloton’s latest earnings call, it claimed that App Tracking Transparency (ATT), which Apple introduced in iOS 14.5, is the culprit as to why it is more difficult to add new subscribers to its services by targeting users based on interests.
Peloton wasn’t timid when it came to citing stats to back up the claim, with the main point being that its post-pandemic economic re-openings are slower than expected.
According to a report from Connect the Watts, rather than the expected $810.7 million in revenue for the quarter, it reported $805.2 million. On top of that, Peloton app shares decreased more than they hoped, with a $1.25 loss per share. That’s a bit higher than the expected $1.07 loss per share, resulting in a total loss of $376 million.
As for subscribers, Pelaton saw an 87% increase year-over-year with 2.49 million connected fitness subscribers at the end of the quarter. So, what’s the problem? Well, Bloomberg’s Mark Gurman tweeted that Peloton said the ATT feature impacts its ability to reach new subscribers, particularly for Peloton Digital. So that refers to people who don’t own Peloton hardware but subscribe to Peloton Digital for classes, similar to Apple Fitness+.
How ATT Works
App Tracking Transparency requires apps to request permission from users before tracking them across other apps and websites. So when a user opts out of being tracked by an app — which is quite common — it negatively impacts the companies ability to know where to target ads effectively. Users can also turn off tracking in their phones Privacy settings at any time.
This certainly isn’t the first instance of ATT negatively impacting companies. Apps including Snapchat, Facebook, Twitter, and YouTube heavily depend on targeted ads, and now Apple has made it much more difficult to reach audiences.