Platoon laid off another 500 workers, the latest in a series of job cuts as the connected fitness company executes a major financial recovery plan.
First reported by The Wall Street Journal, the latest layoffs represent 12% of Peloton’s remaining workforce. According to WSJCEO Barry McCarthy, who took the CEO position in Februarysaid he was giving Peloton another six months to improve financially or it might not succeed as a standalone business.
However, in a statement released yesterday, McCarthy said he believed in the resilience of the business.
“I joined Peloton for the comeback story, not to sell the business. And today the business is fundamentally healthier than ever and on track, so to be clear, there is no clock that pinches our heels. If my comments to the WSJ suggested otherwise, so I misspoke, because that’s just not true,” he said.
THE GREAT TREND
The connected fitness company has struggled financially after a boom during the height of the COVID-19 pandemic. Peloton reported a Loss of $1.2 billion in its fourth quarter ended June 30, with revenue down 28% from the same period in 2021.
In February, the company cut around 2,800 jobs, approximately 20% of its workforce. He also replaced co-founder John Foley with McCarthy, who previously held senior roles at Spotify and Netflix. Foley resigned from his role as Executive Chairman of the Board of Directors last month.
The company also has ceased production its own connected bikes and treadmills, outsourcing production to Taiwanese company Rexon Industrial Corp. about 570 layoffs in Taiwan. The company also cut about 800 customer service and logistics jobs in August.
“Restructuring a business requires tough decisions that affect people’s lives. I am grateful for the many contributions from those affected. The changes we have made, combined with the performance of the business, bring us closer of our fiscal year – the ultimate goal of balancing cash flow, with a renewed focus on growth,” McCarthy said in a statement.
“We are in the business of performance, and the business is indeed performing. By any measure, we have made remarkable progress in record time.”