Latest News: For financial reasons Peloton will increase pricing and eliminate almost 800 employees
Peloton to raise prices and cut nearly 800 jobs to stem cash crunch: Peloton to raise prices and cut nearly 800 jobs to stem cash crunch. In its most recent effort to stop a financial loss that has seen it burn through $1.9bn in the past nine months, Peloton said that it was proposing a price increase and the elimination of 784 employees.
Peloton to cut almost 800 jobs and hike prices
In an email to staff on Friday, the company’s chief executive Barry McCarthy, who took over earlier this year, said the moves — which include outsourcing the company’s last-mile distribution and closing an unspecified number of stores next year — were essential to reverse the company’s financial deterioration.
“We have to make our revenues stop shrinking and start growing again,” McCarthy said in the email, which was first reported by Bloomberg. “Cash is oxygen. Oxygen is life.”
Peloton’s revenue fell by 24 per cent in the latest quarter, as new product sales dropped 42 per cent. It also registered negative free cash flow of $735mn, leaving it with a cash balance of only $880mn.
News of Peloton’s latest actions lifted its shares by 10 per cent on Friday, though they are still off 92 per cent from the all-time high they reached in the first year of the pandemic.