Peloton lays off 2,800 workers and offers them a year of free membership
Announcing the move to investors, Peloton said it was cutting company positions by about 20% and reducing warehouse and delivery teams to save costs.
Curiously, each terminated North American Peloton employee will receive a “free” 12-month monthly Peloton membership in addition to a cash severance package.
In a memo to staff, Peloton co-founder and executive chairman John Foley said the company is committed to providing laid-off workers with “useful tools”.
“This team has never stopped at nothing to get the job done. It’s one of the many reasons why being faced with this decision is all the more difficult,” Foley wrote.
“We equip every team member leaving Peloton with helpful tools to make them as comfortable as possible as they explore their career path after Peloton.”
Instructors and on-camera content will not be affected by the mass layoffs.
Peloton’s most notable sacking was Foley himself – he will be replaced by Barry McCarthy, the former Spotify and Netflix CFO who will become the company’s CEO and chairman.
The latest development in Peloton’s yo-yo trading regimen comes as the company also struggles with a highly volatile stock price.
To date, Peloton shares have plunged more than 80% from their January 2021 high.
The most notable share dive was also Peloton’s most visible.
In early December 2021, shares of Peloton fell more than 16% in two days after Mr Big (a character from the comedy-drama Sex And The City) died of a heart attack during a reboot of the show while riding a Peloton stationary bike.
Despite its battles, Peloton’s premise seems tailor-made to endure multiple pandemic waves of COVID-19.
Described as an “interactive fitness platform”, Peloton is a workout subscription platform that allows users to workout at home and join virtual classes through their TV.
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The company is best known for its line of stationary bikes, which include a built-in display to access workouts. Peloton currently has 6.6 million members worldwide.