Peloton prepares to lay off 500 employees as part of a restructuring plan

0
P

eloton is preparing to lay off 500 employees as the embattled exercise bike maker embarks on a restructuring plan in a bid to turn the tide.

The move represents a reduction of around 12% in its workforce and is the second time a series of job cuts have been announced after the company announced it would lay off 784 people in August in a bid to outsource elements of its logistics.

In a statement, a spokesperson said: “A key aspect of Peloton’s transformation journey is to optimize efficiencies and implement cost savings to simplify our business and achieve balanced cash flow by the end of our exercise.”

Peloton posted a $1.2 billion loss in the fourth quarter in August amid declining sales of its home exercise bikes as customers returned to their pre-pandemic lifestyles.

The company suffered another blow that month after a US judge ruled the company faced legal action over allegedly misleading customers about the size of its fitness class library.

In 2019, Peloton removed thousands of on-demand courses due to licensing issues related to the music in the videos.

District Judge Lewis Linman said “there would be value associated with the products that would drive the price up when that value wasn’t actually there.”

Peloton shares have fallen 76% in the past year after the company suffered a series of damaging setbacks. In February, the company was accused of covering up rust and corrosion on its bikes to avoid product recalls. Peloton said the rust was “superficial” and would not affect the bike’s performance.

Share.

Comments are closed.