Peloton cuts 500 more jobs in its fourth round of layoffs this year
For the fourth time this year, Peloton has announced a series of layoffs. The struggling fitness company is cutting an additional 500 jobs, CEO Barry McCarthy told CNBC. In a memo to employees, McCarthy wrote that the company needed to make the move as part of efforts to achieve cash flow breakeven by the end of Peloton's 2023 fiscal year (i.e. say by the end of next June).
"I am acutely aware that many of those affected by these changes are not just colleagues, but also close friends," McCarthy wrote in the memo, which Bloomberg obtained . "I know many of you will feel angry, frustrated and emotionally drained by today's news, but please know that this is a necessary step if we are to save Peloton, and we are." p>
The latest cuts represent approximately 12% of Peloton's strength. In February, just as McCarthy took office, the company cut about 2,800 positions. In July, Peloton laid off about 570 people as part of a decision to outsource all manufacturing. Then, in August, it cut another 784 jobs to cut costs.
Given that the latest round of layoffs leaves Peloton with around 3,825 employees, that means the company has more than halved its workforce this year. That said, McCarthy noted that with these cuts, "most of our restructuring work is complete."
However, Peloton plans to close most of its retail stores in North America starting next year, which will likely lead to further cuts. McCarthy noted that Peloton lost more than $100 million on its retail operations last year, so changes were needed.
Peloton experienced a business boom after the onset of the COVID-19 pandemic, when people were looking for ways to train at home. However, as the world reopened and people returned to offices and gyms, Peloton found itself with excess inventory and the business took a hit. It suffered an operating loss of $1.2 billion in the April-June quarter. As Bloomberg notes, McCarthy sees subscriptions to Peloton's suite of fitness classes and services, partnerships, and the wider availability of content on third-party devices as keys to increased income.
The company has started selling its connected fitness equipment through Amazon, and the products will soon be available at Dick's Sporting Goods. Peloton has also started offering its bike for hire and has announced a smart rowing machine.
"A key aspect of Peloton's transformation journey is to optimize efficiencies and implement cost savings to simplify our operations and achieve balanced cash flow by the end of our fiscal year. In this mind, we have made the difficult decision to reduce our workforce by approximately 12%," a Peloton spokesperson told Engadget in a statement. "This will result in the reduction of approximately 500 global team members. From...
For the fourth time this year, Peloton has announced a series of layoffs. The struggling fitness company is cutting an additional 500 jobs, CEO Barry McCarthy told CNBC. In a memo to employees, McCarthy wrote that the company needed to make the move as part of efforts to achieve cash flow breakeven by the end of Peloton's 2023 fiscal year (i.e. say by the end of next June).
"I am acutely aware that many of those affected by these changes are not just colleagues, but also close friends," McCarthy wrote in the memo, which Bloomberg obtained . "I know many of you will feel angry, frustrated and emotionally drained by today's news, but please know that this is a necessary step if we are to save Peloton, and we are." p>
The latest cuts represent approximately 12% of Peloton's strength. In February, just as McCarthy took office, the company cut about 2,800 positions. In July, Peloton laid off about 570 people as part of a decision to outsource all manufacturing. Then, in August, it cut another 784 jobs to cut costs.
Given that the latest round of layoffs leaves Peloton with around 3,825 employees, that means the company has more than halved its workforce this year. That said, McCarthy noted that with these cuts, "most of our restructuring work is complete."
However, Peloton plans to close most of its retail stores in North America starting next year, which will likely lead to further cuts. McCarthy noted that Peloton lost more than $100 million on its retail operations last year, so changes were needed.
Peloton experienced a business boom after the onset of the COVID-19 pandemic, when people were looking for ways to train at home. However, as the world reopened and people returned to offices and gyms, Peloton found itself with excess inventory and the business took a hit. It suffered an operating loss of $1.2 billion in the April-June quarter. As Bloomberg notes, McCarthy sees subscriptions to Peloton's suite of fitness classes and services, partnerships, and the wider availability of content on third-party devices as keys to increased income.
The company has started selling its connected fitness equipment through Amazon, and the products will soon be available at Dick's Sporting Goods. Peloton has also started offering its bike for hire and has announced a smart rowing machine.
"A key aspect of Peloton's transformation journey is to optimize efficiencies and implement cost savings to simplify our operations and achieve balanced cash flow by the end of our fiscal year. In this mind, we have made the difficult decision to reduce our workforce by approximately 12%," a Peloton spokesperson told Engadget in a statement. "This will result in the reduction of approximately 500 global team members. From...
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