Peloton to retrench staff, reduce number of its stores

16 Aug 2022 , 11:05 AM

In its most recent effort to turn a profit and free up cash, Peloton is firing staff members and boosting prices on certain of its equipment.
The modifications were announced to the company’s staff in a message from Barry McCarthy, the new CEO of the manufacturer of high-end exercise bikes and treadmills. In addition to eliminating 784 positions, Peloton will terminate its North American distribution network and outsource its delivery operations.

The 86-store North American shop base will be “substantially” reduced, according to the New York-based firm. The number of closing locations was not specified, though.

The modifications are the most recent ones since McCarthy, who was formerly Spotify’s CFO, assumed the role of CEO in February. John Foley, who co-founded the company ten years ago, will be replaced by him.

Peloton experienced a wild ride due to the coronavirus epidemic. Amid lockdowns that made its cycles and treadmills popular with clients who pay a charge to take part in Peloton’s interactive exercises, its shares increased by more than 400% in 2020.

However, last year’s distribution of vaccinations forced many individuals out of their houses and back into gyms, wiping away almost all of those gains. The business is now reducing its ambitious expectations after recording its only profitable quarters during the epidemic.
Peloton made the announcement last month that it would outsource the production of its interactive stationary cycles and treadmills to a Taiwanese manufacturer. It also announced that it will cease production at the Tonic Fitness Technology factory in Taiwan for the rest of the year.

The peloton had roughly 8,600 employees as of June 30 of the previous year, including about 6,700 in the United States. However, it announced in February that it was laying off 2,800 people, including nearly 20% of its corporate staff. It stated at the time that the reduction would not affect teachers who provide interactive lessons for Peloton.