Peloton, the US-based exercise equipment and media company has fired over 2, 800 of its employees, and is in the process of replacing its CEO. The Company, reportedly valued at $50 billion, sank to $8 billion last week. John Foley, co-founder of the Company will be replaced by Barry McCarthy, who has functioned as CFO of Netflix and Spotify previously. Foley will still hold an executive chair.
On Feburary 8, John Foley addressed the Company’s workforce in a press release, in which he said that the Company is going to initiate a comprehensive restructuring programme that is going to help it focus on areas that require adjustment. As a result, it will be reducing its workforce by 2, 800, globally.
One of the reasons for this harsh decision is the Company’s investment in near-term capacity, inventories, and logistics to protect its member experience. However, its post-COVID demands failed to align with the investments and has caused loss of shares in the recent months.
Apart from cutting down its workforce by 20 per cent, Peloton is also going to slow down the construction of the factory it was building in Ohio for $400 million. It will also trim its delivery teams and cut down on itswarehouse space, which will give a relief of $1 billion.
As compensation, Peloton is giving a monthly membership plan to all its fired employees, which will be valid for 12 months.
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