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Peloton & Lululemon Put Differences Aside For Five Year Deal

After several high profile court cases, two global wellbeing brands have put aside their differences and decided to team up.

Peloton and Lululemon have signed a five-year “strategic global partnership,”which sees both brands changing their business models so that they are working in tandem as opposed to competing with each other.

CNN reports that Lululemon will now become “the primary maker of Peloton-branded fitness clothing”. This was a point of contention between the two brands with Lululemon taking legal action over what it stated were copy-cat clothing products from Peloton. Peloton will, as a result, make less clothing in-house. The new line of clothes will be available at stores and online from 11th October.

The deal will also see Lululemon stop selling its Mirror fitness device, which has proved a headache for the brand since it was purchased in 2020. “The $500 million acquisition was written off earlier this year, essentially becoming worthless, and forced Lululemon to search for strategic alternatives to the device. A last-ditch effort in 2022 to cut its price and broaden its appeal with new fitness classes seemingly failed to generate interest from consumers”, wrote CNN.Instead, Lululemon Studio app users will be available to access Peloton’s streaming classes.

Peloton has been in the news for losing more than 90 percent of its value in the past three years. In a press statement, Dion Camp Sanders, Peloton’s chief emerging business officer, stated: “By bringing together the best in fitness content with the best in athletic apparel, we’ll give our communities one-of-a-kind experiences and special content that will inspire them to achieve their goals.”

Sharon Lam, a Reuters Breakingviews columnist, commented on the deal: “The tie-up brings benefits that might help, but it falls short of the full-scale turnaround that Peloton investors need.”



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