(Reuters) - Connected fitness firm Peloton Interactive ( PTON ) raised its core profit forecast for fiscal year 2025 on Thursday, on the back of cost cuts and push-in app-based subscription services, sending shares of the company up 10% in premarket trading.

The maker of high-end stationary bikes and treadmills has been on a turnaround path, implementing job cuts and expanding its focus on selling subscription-based services.

It now expects its 2025 adjusted earnings before interest, taxes, depreciation, and amortization, commonly known as core profit, in the range of $300 million to $350 million, compared with the $240 million to $290 million it forecast earlier.

Former Ford and Apple executive Peter Stern, who took over as CEO in January, is tasked with leading Peloton's turnaround. Stern replaced interim co-CEOs who had led the company since Barry McCarthy's exit in May.

"We see significant opportunities ahead, but we have a steep hill to climb to reach sustained, profitable growth," the company said in its letter to shareholders on Thursday.

Peloton also raised the forecast for its connected fitness subscriptions to between 2.75 million and 2.79 million, reflecting an increase of 55,000 subscribers at the midpoint.

Once a pandemic darling, Peloton has explored alternative revenue sources by partnering with third-party retailers such as Costco and Lululemon Athletica ( LULU ), leveraging higher-margin recurring revenue from subscriptions and launching a bike-rental program.

The fitness-platform provider has been pivoting away from hardware to transition to a software-first company.

It reported an adjusted loss of 24 cents per share for second quarter ended December 31, compared with analysts' expectations of 18 cents, according to data compiled by LSEG.