More fitness content providers are ditching pricey, specialized hardware for app-based experiences people can use on any device, with Lululemon’s Mirror the latest piece of gear caught in the crosscurrents of changing market dynamics.
Lululemon Athletica Inc. is the latest to see the downside of fitness hardware, as reports circulated that the athleisure giant is looking to sell Mirror, the fitness gear maker it acquired in 2020.
Bloomberg reported on Monday (April 17) that Lululemon “is working with an advisor” to explore selling Mirror, for which it paid $500 million just three years ago.
Per the news outlet, “Mirror’s hardware sales have missed Lululemon’s projections and the Vancouver-based company took $443 million in impairment charges on the business in the fourth quarter. The company, which at one point was selling Mirror products in-store, has pivoted to a digital and app-based product that it has rebranded as Lululemon Studio.”
In its results for fiscal Q4 2023 ended January 29, Lululemon said, “The Company is evolving its Studio strategy and will focus on digital app-based services. It will continue to provide in-home hardware and content for members who own or would like to purchase a Lululemon Studio Mirror and currently, there are no changes planned for the free, Essentials tier of the membership program which continues to experience robust growth in new members.”
It added that “Building on the two-tier membership program launched in October 2022, the Company will be expanding the Lululemon Studio premium tier by enabling guests to access its digital fitness content via a new app, launching in summer 2023, for a lower monthly fee.”
That’s a pivot away from hardware centricity and toward the ability to consume Lululemon fitness content on any screen, anywhere. This began with its October 2022 launch of Lululemon Studio, at which time the company called it “a new service connecting members to the most dynamic fitness content, community and products — at home, in person, and on the go,” saying workouts would be “accessible through the lululemon Studio Mirror, app and in-person experiences.”
Per the Bloomberg report, a spokesperson said, “We don’t comment on rumors or speculation. As previously announced, we are shifting the focus of Lululemon Studio from a hardware-centric offering to one that is also focused on digital app-based services going forward. This work is underway, and our strategy will enable us to create long-term value and build a larger community of guests with a deeper connection to Lululemon.”
That story also noted that “Fitness-focused hardware companies have struggled since pandemic habits ended, sending consumers back to in-person or group workouts. Peloton Interactive Inc., for instance, has seen its stock slump roughly 92% in the past two years, while Tonal’s CEO recently stepped down after the company raised funding at a significant discount to its prior valuation.”
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