Peloton, the once-thriving fitness company, has hit another rough patch as it struggles to regain its footing in the post-pandemic era. CEO Barry McCarthy is now stepping down after the company’s share price dropped about 92 percent during his tenure.
The Verge reports that Peloton recently announced a fresh round of layoffs affecting approximately 400 employees, which amounts to 15 percent of its remaining global workforce. This marks the fifth time Peloton has had to resort to workforce reductions since its peak in 2021, highlighting the company’s tough journey to realign its operations with the shifting market dynamics.
With Peloton stock down approximately 92 percent from its high in 2020, the latest downsizing comes as a bitter pill to swallow, as it directly contradicts the assurances made by outgoing CEO Barry McCarthy during Peloton’s Q1 2023 earnings call, where he stated that the company was done with layoffs and that the “ship was turning.” McCarthy, a former executive at Spotify and Netflix, took the helm from founder John Foley just over two years ago, with the aim of steering Peloton through its turbulent times. He is now leaving the company after presiding over the company’s massive loss of share value.
LAS VEGAS, NV – JANUARY 11: Maggie Lu uses a Peloton Tread treadmill during CES 2018 at the Las Vegas Convention Center on January 11, 2018 in Las Vegas, Nevada. (Photo by Ethan Miller/Getty Images)
The layoffs are part of a broader 12-month restructuring program aimed at reducing annual expenses by more than $200 million, a crucial step as the company seeks to refinance its debt. Karen Boone and Chris Bruzzo, both board members, have been appointed as interim co-CEOs until a permanent replacement for McCarthy is found.
Peloton’s workforce has dwindled significantly from its peak of 8,600 employees in 2021, with the latest cuts leaving the company with approximately 3,000 global employees. The company’s tumultuous journey can be traced back to the coronavirus pandemic, during which Peloton experienced a surge in demand as people sought home workout solutions. However, the company failed to anticipate the shift in consumer behavior once the world reopened after the rollout of vaccines.
In an effort to meet the unprecedented demand during the pandemic, Peloton had invested heavily in its supply chain, pouring hundreds of millions of dollars into addressing shipping delays. However, as the world emerged from lockdowns, the company found itself grappling with an oversupply of products and a dwindling customer base, leading to a series of layoffs and restructuring efforts.
Despite the challenges, Peloton continues to explore new avenues for growth, such as partnering with hotel chains like Hyatt to bring its workout bikes to over 800 locations. The company has also faced controversies, including its decision to discontinue support for Apple Watch GymKit, a move that sparked outcry from its dedicated fan base.
Read more at the Verge here.
Lucas Nolan is a reporter for Breitbart News covering issues of free speech and online censorship.