The pandemic swallowed. Four years ago we were all stuck at home and will continue to be stuck at home for months. While we’re all trapped in our homes, some products have taken a serious COVID-19 hit. Grocery delivery services have completely exploded, like Zoom and others .
The same goes for Peloton and its line of exercise equipment. People were buying bikes and treadmills in droves, and the company’s market value grew from $6 billion to $50 billion. However, what goes up must come down, and Peloton’s market cap has fallen to $10 billion by 2022 and is now around $1 billion. The company’s pandemic-era success story is officially over, and it’s now focused on cutting costs. So this means cuts. Peloton cuts 15 percent of workforce which is 400 people.
Apart from these massive layoffs, the company . CEO, president and board director Barry McCarthy is also stepping down after two years on the job. He was previously CFO at both Spotify and Netflix. Peloton says it is currently in the process of finding a successor to serve as interim CEO, with chairwoman Karen Boone and director Chris Bruzzo serving as interim CEO.
However, it is expanding its international reach, announcing a more “targeted and efficient” marketing strategy abroad. Together, Peloton hopes these steps will reduce annual costs by $200 million by the end of fiscal 2025.
All this comes after the company reported dismal Q3 2024 profit and loss numbers. 21 percent reduction in paid subscriptions Compared to 2023. Unfortunately, Q2 was no better. Not that the stock market really means anything, just look at Tesla or that weird Trump stock, but Peloton’s stock went from $156 in 2021 to less than $3 today.
They are not just “People are coming out again” numbers, as the company has experienced its share of controversies that have nothing to do with the pandemic. Tread+ treadmill 90 injuries and one child death. The peloton too on the issue of security. It’s been a bad few years.
All of this isn’t to say that Peloton can’t change things just because it’s a fairly iconic brand in the space. However, it definitely needs to do some work to reverse this decline.
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