Peloton is set to axe around 800 jobs, increase the price of its equipment and close some of its retail operations as part of efforts to turn around the decline in its business.
The troubled at-home fitness giant has seen its share price plummet from a high of US$162 in December 2020 to the current US$13.
The company has struggled to capitalise on its pandemic successes, which were partly driven by gyms being forced to close and people looking for alternative exercise options – a "pivot" with which Peloton became near-synonymous.
Since lockdowns ended and people returned to facilities, Peloton has found the going much tougher.
Current Peloton CEO Barry McCarthy replaced former CEO John Foley in February 2022 as part of a drive to get the company back on track.
Since then, McCarthy has initiated an aggressive strategy which has placed cutting costs and increasing revenues at its heart.
McCarthy recently announced that Peloton will exit all owned manufacturing operations, cease making its own products and, instead, expand its partnership with Taiwan-based manufacturer Rexon.
The move came just 14 months after Peloton acquired equipment creator Precor, in a deal worth US$420m, renaming it Peloton Commercial. The move saw the eventual exit of long-time Precor leader, Rob Barker.
The Precor deal, agreed under the stewardship of John Foley, was meant to result in Peloton establishing a US-based manufacturing operation, helping it to meet the increased demand for its products created by the pandemic.
Now, adding to the U-turn in its manufacturing plans and the string of job cuts, Peloton said it will also increase the prices of its equipment.
The latest move comes as inflation and increases in gas and energy prices are putting pressure on the cost of living for consumers globally.
In the US, the price of the Peloton Bike+ will increase by US$500 to US$2,495. The price of the Peloton Tread will increase by US$800 to US$3,495. In Canada, the price of the Peloton Bike+ will increase by CA$800 to CA$3,295. The price of the Peloton Tread will increase by CA$1,100 to CA$4,495.
In the UK, the price of the Peloton Bike+ will increase by £150 to £1,995. The price of the Peloton Tread will increase by £900 to £3,345. In Germany, the price of the Peloton Bike+ will increase by €500 to €2,495. The price of the Peloton Tread will increase by €1,100 to €3,795. In Australia, the price of the Peloton Bike+ will increase by AU$350 to AU$3,345. The Peloton Tread is currently not available in Australia.
In a statement, the company said: "Inspired by the progress we've made on our transformation journey, we're adopting a more strategic pricing strategy for our premium products.
"Price is just one of the many levers we will continue to explore as part of our business transformation strategy."
