Peloton offers year's free membership in 2,800 staff's redundancy package amid large scale cost-cutting measures
The indoor fitness brand has suffered a massive drop in sales over the last couple of months
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Peloton is currently in a state of crisis, with its share price plummeting, its CEO John Foley resigning and having to make 2,800 employees - around 20 per cent of its workforce - redundant.
In order to soften the blow for those staff members laid off, Peloton is offering a year's free membership to its classes within the redundancy package, though they will have to own a Peloton product themselves to access this offer.
With the company looking to cut costs, it has also cancelled plans to build a new factory in Ohio, USA, originally designed to reduce its dependency on foreign suppliers.
John Foley, former Peloton CEO, said before his resignation: “These decisions, particularly those related to our impacted Peloton team members, were not taken lightly.
“We greatly value the contributions of our talented colleagues and are committed to supporting impacted team members in their transitions. We thank our global team members for their focus and dedication through this process.”
Former Spotify CFO Barry McCarthy will now take over from John Foley as CEO, as Peloton faces a major restructure to try and halt the slide.
At the height of the pandemic, Peloton enjoyed substantial success, its peak valuation reaching $50bn. Ever since though, the indoor fitness brand has suffered considerable losses and a major drop from its once lofty heights.
The company posted a net loss of $439.4m for the three-month period ending December 31, while in the same month it announced it planned to temporarily halt production of its machines.
Peloton is now unsure of its direction, though, and is the subject of a potential bidding war between some of the largest global corporations in the world, including Amazon, Nike and Apple. Latest revelations has seen Peloton's market value fall to less than $8bn this week.
The company said: “If a bidding process begins, we view Apple as the likely acquirer due to the clear strategic fit with its healthcare/fitness/subscription initiatives, while Amazon and Nike among others could be potential bidders in the mix.
“The reality is that Foley was the pilot on the Peloton growth plane and him leaving paints a bleak picture with the main visionary no longer in charge."
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Ryan is a staff writer for Cycling Weekly, having joined the team in September 2021. He first joined Future in December 2020, working across FourFourTwo, Golf Monthly, Rugby World and Advnture's websites, before making his way to cycling. After graduating from Cardiff University with a degree in Journalism and Communications, Ryan earned a NCTJ qualification to further develop as a writer.
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