Peloton continues to struggle following a tumultuous year and revelations of potential layoffs, halted production, and a stock sale by insiders.
The company reported a net loss of $372 million in fiscal Q1 2022, a steep increase from the $49.8 million loss in the same period a year prior. Prior to the decline, Peloton executives and insiders sold roughly $500 million worth of stock when share prices were in better shape in the fall of 2020 through much of 2021, per SEC filings.
The at-home fitness brand’s market cap has fallen by at least 80% in the past year. Shares of the company closed at $24.22 on Thursday.
A number of drastic cost-saving measures are underway.
- CNBC reported the comppany planned to temporarily paue production of its bike products from February to March and won’t manufacture its Tread treadmill for six weeks — or its Tread+ at all — in fiscal 2022.
- The claim was later refuted by CEO John Foley, who said the report was “incomplete, out of context, and not reflective of Peloton’s strategy.”
- The opening of a $400 million Ohio factory has reportedly been delayed.
Work in Progress
Peloton is working with consulting firm McKinsey & Co. to restructure the business by evaluating its cost structure and potentially eliminating jobs.
In a leaked audio recording, executives discussed plans to terminate 41% of Peloton’s sales and marketing teams and implement minor layoffs throughout its e-commerce and retail divisions.
The group also discussed closing 15 of the company’s 123 retail locations.
CEO John Foley said in a statement that the company is taking “significant corrective actions” and will share more details during its earnings report in early February.