“If you’ve been wondering whether or not Peloton can make an epic comeback, this quarter’s results show the changes we’re making are working,” Peloton CEO Barry McCarthy wrote Wednesday in an investor letter accompanying the company’s Q2 2023 earnings report. McCarthy is no stranger to bold claims, but a year after taking the helm of the troubled company, it seems like the numbers are starting to back him up. In its Q2 2023 earnings report, Peloton reported a loss of $335.4 million compared to $439.4 million this time last year. On the surface, a loss doesn’t seem like a win — especially since it’s Peloton’s eighth consecutive quarter without turning a profit. However, it’s the narrowest loss Peloton’s reported ever since it started pedaling its business off a cliff at the end of 2021. Added to that, Peloton beat out analysts’ expectations for the quarter, posting $792.7 million in revenue compared to Wall Street’s estimate of $700 –$725 million. It also probably helps that Peloton’s revenue forecast for Q3 is higher than analysts expected and that Peloton’s made significant progress in improving its cash flow. In the year since McCarthy took over, Peloton’s cash flow improved 83 percent from negative $546.7 million to negative $94.4 million. In today’s investor call, McCarthy reiterated that his first priority was to get cash flow under control so Peloton could “control [its] own destiny.” McCarthy tends to be bullish in earnings calls, but for once, investors seem to be listening. (Or are at least less skeptical.) Peloton’s stock price is up roughly 10 percent in early trading. That said, Peloton still has its work cut out for it. For the third straight quarter, subscription revenue made up for less than stellar hardware sales. Peloton chief financial officer Liz Coddington noted that demand for the newly released Peloton Row exceeded expectations. However, as much as 65 percent of rower sales went to existing Peloton subscribers during the holiday period. (That number has since declined to roughly 40 percent.) Coddington also said the company was still building awareness for the rower outside its member base. Speaking of which, Peloton’s members remained static year over year at 6.7 million, though the company did increase the number of subscriptions by 10 percent to 3.03 million. Monthly churn also stayed at 1.1 percent — which is still good, but for a long time, Peloton had boasted a churn rate of less than 1 percent. Basically, Peloton is still losing money on its expensive equipment, making up the shortfall with subscriptions, but it hasn’t exactly seen an influx of new users. While Peloton Row sales exceeded expectations, as much as 65 percent of holiday sales went to existing Peloton members. Photo by Amelia Holowaty Krales / The Verge In a surprising move, Peloton also said it no longer plans to sell Precor, a well-known commercial fitness equipment maker, after getting lowballed by a potential buyer. Peloton acquired Precor for $420 million in 2020 to alleviate shipping delays but has since been “underinvested” in the company while cannibalizing its leadership. For now, it plans to reinvest in the company. “This was by far our best quarterly performance in my twelve months with Peloton,” McCarthy says in the investor letter before acknowledging that the company still has issues to fix with regard to last-mile delivery and member support. But while McCarthy’s aggressive restructuring plan is showing signs of working, it wasn’t really a question of whether Peloton would survive. It was a question of whether it could do it on its own. While sales rumors have died down from a year ago, Amazon and Nike are still reportedly interested in potentially buying the company. As for an epic comeback, that’ll depend on whether the company can thrive instead of just surviving.