The Peloton plot thickens. 2,800 Employees were laid off, but got free memberships as exit "gifts".
It's been quite the day, week, month, and even year for Peloton. Their successes from the pandemic home fitness boom has now sizzled. Gyms reopened, inflation rose high, and supply chain issues began to hurt Pelton.
The "fad" seems to be over, and the issues have been piling up. Last month, they temporarily halted production of its products and they began being cash strapped. Here's a good thread that describes the issues in detail, thanks to their public presentation.
To make matters more interesting, their CEO and Co-Founder, John Daley, has stepped down, and the company laid off about 2,800 employees (about 20% of its workforce). Barry McCarthy will become CEO and president and join Peloton’s board.
Part of every lay off, each impacted employees will receive a one-year digital subscription to Peloton
“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,”
READ THE ROOM!
Yes, every employee definitely owns a bike, and it's a nice gesture, but what a slap in the face. "Hey, we're letting you go, but we hope you enjoy riding with us the next year for free!" Yikes.
In other words, "the bag has been fumbled", not only on how they handled these situations, but the financials too. Pre-pandemic, they were trading at $23 per share, and skyrocketed to a high of close to $160. Since August of 2021, $PTON stock is down 68%, and now below $37. Their stock valuation went from $50 billion a year ago to now about $8 billion. However, it did have a 25% bump today. A good time to buy?
My hot take... Apple swoops in when they hit a low sweet spot. They have the iPad technology, might as well slap it on a bike? Maybe Nike or Amazon throw their hat in the ring and fix the company.
Photo: Google Finance