Peloton (NASDAQ: PTON) has received a large serving of criticism on Twitter (NYSE: TWTR) this week, with comments seemingly sparking a downward trend in stock value. Peloton's stock dropped as much as 10% in intraday trading on Tuesday, which was the most loss to the stock in two months. Outrage online came from the company's 30-second holiday TV ad that depicts a woman showing a year-long video diary to her partner about her journey on the Christmas gift of a Peloton he gave to her. Critics on Twitter saw the ad as sexist and promoting the idea of women being pressured to watch their weight.
A popular tweet from user Siraj Hashmi wrote: "Nothing says 'maybe you should lose a few pounds' like gifting your already rail thin life partner a Peloton."
This ad first appeared about a month ago to at the beginning of the holiday season in mid-November, but the online outrage came to a peak on Monday.
However, some users have praised the ad, with one user stating that "I love this ad, because, in it, I see me...I didn't see this whole thing about this poor woman wanting to lose weight and taking selfies without changing her body. I didn't see that at all. That's not what Peloton is about. Some people have the goal to lose wight. That's not the primary goal. It's overall to be healthy, and to be around for your family for the long term."
Despite speculation about the stock price drop and rumors that the ad could be taken off the air, Peloton does not believe the recent stock movement is tied to the ad. A company representative stated Wednesday that "We constantly hear from out members how their lives have been meaningfully and positively impacted after purchasing or being gifted a Peloton Bike or Trend, often in ways that surprise them. Our Holiday spot was created to celebrate that fitness and wellness journey. While we're disappointed in how some have misinterpreted this commercial, we are encourages by--and grateful for-- the outpouring of support we've received from those who understand what we were trying to communicate."
Peloton has been criticized in the past as being classist, with the bike retailing for $2,245 and the company's interactive classes costing $39 per month.
Despite the recent decline, shares of Peloton's stock surged 47.6% in value in November, with the company beating revenue estimates. This increase came from fitness subscribers to the company's interactive classes increasing 103%, expanding the member base to 1.6 million. Revenue also jumped by 103%, to $228 million. Peloton as a company has also maintained a 94% 12-month retention rate, meaning the subscribers are staying with the program for the long haul.
The stock had a 19% rally over the holiday weekend amid reports of strong Black Friday store traffic and conversions. That all changed when Peloton saw a $942 million in market value wiped out in a single day from the backlash, which brought the company's market cap to roughly $9.4 billion.
Peloton has recently lowered the price of its digital-only subscription, from $19.99 to $12.49 a month and released two new apps for the Apple Watch (NASDAQ: APPL) and Fire TV (NASDAQ: AMZN), a move that seems to be an effort to attract more consumers that do not want to take the plunge in buying their branding stationary bicycles or treadmills. The company may see this as the reason for the recent stock value decline.