Peloton Interactive, Inc. (PTON) shares plummeted 15.26% in pre-market trading on Thursday following the release of its disappointing third-quarter earnings report. The connected fitness company's results revealed ongoing challenges in its post-pandemic recovery efforts, sparking concerns among investors.

Peloton reported a quarterly loss of $0.12 per share, significantly wider than the analysts' expectations of a $0.06 loss. This disappointing figure overshadowed the company's slight revenue beat, with Q3 revenue coming in at $624 million, marginally above the estimated $621.3 million. However, this still represented a 13.1% decline compared to the same period last year, marking the third consecutive year-on-year decrease in sales.

The company's financial struggles were evident across multiple segments. Hardware sales, including its signature bikes and treadmills, plunged 27% during the quarter, while subscription revenue dropped 4%. These declines highlight Peloton's ongoing difficulties in maintaining its pandemic-era momentum. Adding to investor concerns, the company announced that its Peloton and Precor-branded equipment is currently subject to a 25% tariff on their aluminum content, which is expected to create a $5 million headwind to fourth-quarter results. Despite these challenges, Peloton narrowed its fiscal year 2025 revenue forecast to between $2.46 billion and $2.47 billion, and projects free cash flow of around $250 million for the fiscal year, incorporating the tariff-related headwinds.