Apple’s efforts to bolster your privacy protections on iPhone and iPad are being blamed for a sharp decline in Peloton sales.
The company enjoyed a boom while everyone was stuck at home during the pandemic, but it has since been forced to cut its outlook by as much as $1 billion. It said this week that Apple’s crackdown on tracking is partly at fault.
Peloton sees sales fall after Apple cracks down on tracking
Peloton shares dived 32% on Friday after it confirmed a revised revenue prediction of $4.4 billion to $4.8 billion for 2022 — down from the $5.4 billion it expected earlier. The company admits it is struggling to attract new customers.
With more and more people returning to work, school, and the gym now that the pandemic is easing around the world, the incredible interest Peloton’s online fitness classes and electronic bikes was seeing has significantly waned.
Supply problems, as well as a mammoth rise in freight costs, is also to blame for Peloton’s predicted revenue slump. Another big factor? Apple’s decision to give users control over which apps can track their interests on iPhone and iPad.
Introduced in iOS 14.5 back in April, App Tracking Transparency forces developers to obtain user permission to keep tabs on their activities across other apps — a practice most previously employed without a user’s knowledge.
Of course, most users decline this permission when prompted — as they should — making it significantly more difficult for marketers to target shoppers based on their interests. So, Peloton’s ads are nowhere near as effective anymore.
Peloton is not the only one that has bemoaned this change. Facebook, Twitter, Alibaba, and many others have voiced concerns about how App Tracking Transparency could hurt their businesses. Apple would rather put users first.