Yesterday, we reported that Peloton was preparing to lay off more than 40% of its sales and marketing hires. As it turns out, that won’t be the only thing the company’s laying off…
The at-home fitness giant, which appreciated monstrous growth during the pandemic, will reportedly be halting production of its smart bikes and treadmills. 🛑 ✋ The company cited a “significant reduction” in demand for connected fitness equipment, which has been closely related to pricing and competition.
The news stems from a confidential internal report from the company, which was detailed at length in CNBC. CNBC’s report comes just a day after Business Insider broke a report suggesting that Peloton would use a recent performance review to cut employees in both physical and digital stores. 😬
The company hired more than 3,000 employees in the thick of the pandemic as part of a growth campaign Peloton now refers to as “undisciplined.” The company implemented a hiring freeze in November and reduced its FY 2022 outlook by more than a billion dollars. The company said in previous earnings reports that it does not expect to be EBITDA profitable until FY 2023.
However, when Peloton reports earnings on Feb. 8, we might find that the company’s renewed commitment to cost-cutting could punt its plans for profitability even later down the line. Considering the state of the company — with all the expected layoffs, turnover, and hiccups — it’s possible Peloton might have bigger problems on its hands.
$PTON fell 23.9% today on the news. It’s now down more than 84.6% in the last year. 📉