Peloton to Cut 800 Jobs, Hike Prices and Shut Stores in Sweeping Overhaul

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Peloton to Cut 800 Jobs, Hike Prices and Shut Stores in Sweeping Overhaul

Mark Gurman
Fri, August 12, 2022 at 12:42 PM

(Bloomberg) -- Peloton Interactive Inc. will embark on a sweeping overhaul that includes cutting nearly 800 jobs, raising prices for its Bike+ and Tread machines, and outsourcing functions such as equipment deliveries and customer service to outside companies.

The changes, which the company disclosed Friday in a memo to employees, also includes gradually closing many of its retail showrooms — a process that will get underway next year. It’s the most wide-ranging shake-up yet under Chief Executive Officer Barry McCarthy, a tech veteran who took the helm in February.

Peloton is hoping to turn around a business that had thrived during the early days of the pandemic but suffered a punishing slowdown in the past year. Sales are declining, losses are mounting, and the company’s stock price was down nearly 90% over the past 12 months. The latest moves are an attempt to reinvigorate sales, boost efficiency and restore some of Peloton’s former cachet.

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In its third known set of layoffs this year, the company will fire 784 employees across its distribution and customer service teams. Peloton will stop using in-house employees and vans to deliver equipment and shutter 16 warehouses across North America. Instead, it will rely on providers of third-party logistics, or 3PL, to set up bikes and treadmills at customer homes.

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