Peloton is on the fast track to DOOM!
The fitness company has not been having a great end of 2021 and start of 2022.
Peloton Interactive Inc. announced it will be replacing its CEO and co-founder, John Foley, in addition to cutting thousands of jobs and costs earlier this week.
This alarming move comes after the company experienced a massive slow-down in sales, in turn causing its market value to plummet.
Peloton Going Through Massive Company Shakeup
Foley was a founding member of the company and has been with Peloton since its inception.
He has led the company for its entire 10-year existence, but will now step down as CEO.
However, he is not gone for good
The company told The Wall Street Journal that Foley will become executive chair of the company.
So, who will be filling Foley’s shoes?
CEO John Foley Is Stepping Down
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Former Chief Financial Officer of Spotify and Netflix, Barry McCarthy, will become the new CEO and president of Peloton Interactive Inc. He will also be joining Peloton’s board.
News of the higher-up shakeup comes after the company announced it would be cutting 2,800 jobs on Tuesday, February 8.
2,800 Jobs and Employees CUT!
The job cuts were made to help cope with the drop-off in demand and widening losses, according to Fox Business.
In the event you’re panicking about your favorite instructor or workout will be cut from Peloton, don’t.
The job cuts will not affect Peloton’s instructor roster or content.
In 2020, the fitness equipment company saw an astronomical boom in sales given the COVID-19 pandemic shut down everything including gyms, state parks and walking trails.
Many people had to resort to working out from the confines of their home.
However, as things started to reopen in 2021, gyms included, the company saw an unsettling drop-off in sales and were rumored to have paused Peloton bike production.
The company denied the claim, but it’s clear now Peloton Interactive Inc. is struggling.
On January 20, Foley issued a press release regarding bike production.
“This week, we’ve experienced leaks containing confidential information that have led to a flurry of speculative articles in the press. The information the media has obtained is incomplete, out of context, and not reflective of Peloton’s strategy,” the release said. “Rumors that we are halting all production of bikes and Treads are false.”
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The company has given the 2,800 employees a parting gift.
Foley is offering the nearly 3,000 employee’s free classes for an entire year as part of a severance package.
Foley Gives Free Classes For A Year To Laid-Off Employees
Per the New York Post, the Peloton membership, which typically costs $40 per month, comes in addition to more typical layoff measures including cash severance payments, extended health care coverage and help finding new jobs.
“We are equipping every team member leaving Peloton with helpful tools to make them as comfortable as possible as they explore their career path post-Peloton,” wrote Foley
Some employees found out about their lay-off from news articles and the media. Many were left scrambling to figure out if they were on the lay-off list.
A source told The Post, “There are folks freaking out right now wondering if they are on the [layoff] list. Everything has been so hush-hush.”
