New York
CNN
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Peloton And Lululemon, Former enemiesthey cooperate together.
The fitness companies announced a five-year “strategic global partnership” that includes Lululemon divesting its Mirror fitness equipment and Peloton ending its private-label fitness apparel. The financial terms of the deal were not disclosed.
Starting next month, Lululemon will manufacture Peloton-branded fitness apparel, ending Peloton clothing A two-year-old attempt In-house producing fitness apparel as a competitor to Lululemon. The clothing line sparked a lawsuit between the companies with Lululemon accusing Peloton of creating “counterfeit products.” The two companies settled Lawsuit last year.
The new clothing line will be sold online and in Peloton studios starting October 11.
In contrast, Lululemon will stop selling its $995 Mirror fitness device by the end of the year and will soon end production of its own Peloton-like fitness classes. In the next few months, Peloton’s streaming fitness classes will be available in the Lululemon Studio app for subscribers. Lululemon relaunched the app about a year ago as a competitor to Peloton, giving subscribers streaming classes from trendy fitness studios like AARMY and celebrity favorite Dogpound.
The mirror has been a sore point for Lululemon ever since Buying at the height of the COVID-19 pandemic in 2020. The $500 million acquisition was written off earlier this year and essentially worthless, forcing Lululemon to look for strategic alternatives to the device. One last try in 2022 Reducing its price and expanding its appeal With new fitness classes it seems that they have failed to attract the interest of consumers.
“By combining the best fitness content with the best activewear, we will give our communities unique experiences and special content that will inspire them to achieve their goals,” said Deion Camp Sanders, President of Peloton. Emerging Business Officer, in a press release.
The partnership stems from the two companies’ realization that “engaging in areas outside their core competencies was not yielding results,” according to Neil Saunders, retail analyst at GlobalData.
“Peloton’s push into clothing was a failure because the selection was poor and it looked incredibly lackluster in stores. The company wasn’t doing enough volume to justify the process,” Saunders told CNN. “Lululemon’s mirror device was a failure because it was too expensive and too complicated. ”
He added: “The partnership is beneficial for both companies, but Peloton arguably needs it more because it is still in a very fragile position financially.”
Peloton shares (Button) rose 14% in premarket trading on Thursday, while Lululemon stock rose (Lulu) Inventory was constant.
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