In the News
Retrenchment in Action | Calm and Peloton
Two businesses that boomed during the pandemic are finding business much harder now.
The BBC reports here on significant redundancies at exercise equipment maker Peloton and meditation app Calm.
Peloton's latest round of around 800 job losses comes just a few months after announcing several thousand redundancies. Demand for Peleton's "smart" exercise bikes and treadmills has plunged after initially booming when people were forced to stay at home.
Peloton's sales have been hit by a resurgence in demand for gyms and group fitness classes, and operational mismanagement that led to the resignation of CEO and co-founder John Foley earlier in 2022.
Online market places especially in the USA are said to be flooded with second-hand Peloton bikes as users try to offload them in preference for getting out more on standard bikes or finding a good deal with a local gym. A fall in the re-sale value of a stationary bike makes it less attractive to buy a new one in the first place.
Peloton's share price dropped to an all-time low of $8.22 in mid-July 2022. Shares had traded as high as $120.62 less than a year ago. The share price when Peloton listed on the US stock market in 2019 was $29.
Peleton is now looking to cut their fixed costs so the business stops hemorrhaging cash.