US exercise equipment and media company, Peloton Interactive Inc, said it is planning to cut about 500 jobs to reverse mounting losses.
Chief Executive Barry McCarthy, who took over in February, said he is giving the unprofitable company about another six months to significantly turn itself around and, if that fails, Peloton likely isn’t viable as a stand-alone company, the Wall Street Journal reported on Thursday.
To cut costs, the company cut hundreds of jobs, shuttered stores and outsourced delivery to third parties this year.
It also has eliminated about 600 more jobs since June than previously disclosed through retail store closings, attrition and other moves, Peloton said.
Near the start of pandemic, the company employed about 3,700 people, and grew to over 8,600 in 2021 to meet explosive demand.
In September, the company accepted the resignations of John Foley as Executive Chair and Hisao Kushi as Chief Legal Officer, effective September 12 and October 3, respectively.
“We are immensely grateful to John and Hisao for having the vision, ambition, and commitment to turn Peloton into the iconic consumer brand it is today. Their impact will resonate long after their departure, said Karen Boone, Peloton’s Chairperson of the Board.
In August 2022, Peloton said it would start selling its exercise bike and other fitness accessories on e-commerce giant Amazon in the US to combat a slowdown in sales from pandemic highs.
Peloton’s exit from selling exclusively through its own e-commerce site and global showrooms marked McCarthy’s bet to attract more customers, cut losses and improve cash flow.
The company has reported six straight quarterly losses, culminating in a $1.2 billion loss in the most recent quarter. Its shares have fallen nearly 95 per cent since their December 2020 high topping $160. The demand for its products has plunged and the number of people who subscribe to its fitness classes has stagnated as subscribers return to gyms post-Covid pandemic.