Yahoo Finance Peloton gears up to fire 500 staff as part of restructuring plan
Peloton is gearing up to sack 500 staff as the beleaguered exercise bike maker embarks on a restructuring plan in a bid to turn its fortunes around.
The move represents a cut of around 12% of its workforce and is the second time a round of job cuts was announced after the company said it would fire 784 people in August in a push to outsource elements of its logistics.
In a statement, a spokesperson said: “A key aspect of Peloton’s transformation journey is optimizing efficiencies and implementing cost savings to simplify our business and achieve break-even cash flow by the end of our fiscal year.”
Peloton reported a $1.2 billion fourth quarter loss in August amid a drop off in sales of its at-home training bikes as customers returned to pre-pandemic lifestyles.
The firm suffered another blow that month after a US judge said the firm must face a lawsuit over allegedly misleading customers over the size of its fitness class library.
In 2019, Peloton removed thousands of on-demand classes over licensing issues related to music contained in the videos.
District Judge Lewis Linman said “there would be value associated with the products that resulted in an increased price when that value was not actually there.”
Peloton shares have dropped 76% in the past year after the company suffered a series of damaging setbacks. In February, the business was accused of concealing rust and corrosion on its bikes to avoid product recalls. Peloton said the rust was “superficial” and would not impact the bike’s performance.
