Shares of Peloton (NASDAQ: PTON) jumped by as much as 12.5% in early trading on Thursday after the company announced a major new partnership with Lululemon Athletica (NASDAQ: LULU). Peloton shares rose early but quickly backpedaled, and even traded lower for a short period in morning trading. As of 12:50 p.m. ET, shares were up by 6.3%. 

The partnership entails two different agreements in digital fitness and apparel. On the digital fitness side, Lululemon will distribute Peloton's content through its Studio Members products, and will also offer current Lululemon Studio app-only customers Peloton App One membership after Lululemon's service shuts down in November.

On the apparel side, Lululemon will become the "primary athletic apparel partner to Peloton," increasing the sales channels for Lululemon. 

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Source Fool.com