Peloton to slash 780 jobs and hike prices in push to turn profit
Peloton told employees it is slashing some 780 jobs, closing a number of stores and hiking prices on some equipment in a bid to cut costs and become profitable.
Peloton told employees Friday that it is slashing roughly 780 jobs, closing a significant number of its retail stores and hiking prices on some equipment in a bid to cut costs and become profitable.
The company did not specify how many of its 86 retail locations it plans to shutter, but said an “aggressive” reduction will begin in 2023. The pace of closures will depend on how quickly Peloton can negotiate getting out of leases.
Peloton said it will exit last-mile logistics by closing its remaining warehouses and shift delivery work to third-party providers, resulting in a portion of the job cuts. It is also cutting a number of positions in its in-house support team, which are mainly located in Tempe, Arizona, and Plano, Texas, and instead will rely on third parties.
The sweeping changes are part of recently installed Chief Executive Officer Barry McCarthy’s plan to steer the connected fitness equipment maker in a new direction. Peloton’s business boomed to unthinkable highs after the onset of the Covid pandemic, sending shares surging alongside other so-called stay-at-home stocks like Zoom. But under then-CEO and Peloton founder John Foley, demand began to slow almost as quickly as it shot up, as people started going out again.
McCarthy’s biggest tasks now include getting rid of fixed costs and finding more ways to cash in on its loyal base of customers.
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