Peloton has gone completely downhill. Today, the company announced that the cofounder/CEO is stepping down. The company is also cutting 2,800 jobs (20% of the workforce) due to falling demand. At least the fired workers are getting year-long memberships for free. Peloton's market value has plummeted from $50 billion last year to $9.8 billion. As Will Ferrell's SNL character once exclaimed, "What the hell happened??"
To start with, demand soared during the pandemic as lockdowns forced gym closures and active people wanted to get their fitness on at home. Peloton ramped up production and was raking it in. They even planned to build a $400 million manufacturing facility in Ohio. Growth started to slow as restrictions eased, and in January there were reports of pauses in production for bikes and treadmills. Some people say there is no such thing as bad press, but ask Peloton what they think of that after two high-profile cable TV shows (Sex and the City reboot and Billions) showed people having heart attacks while using Peloton bikes.
I'm sure business students will use Peloton as a case study to figure out what went wrong. Hindsight is 20/20 and all that.
To start with, demand soared during the pandemic as lockdowns forced gym closures and active people wanted to get their fitness on at home. Peloton ramped up production and was raking it in. They even planned to build a $400 million manufacturing facility in Ohio. Growth started to slow as restrictions eased, and in January there were reports of pauses in production for bikes and treadmills. Some people say there is no such thing as bad press, but ask Peloton what they think of that after two high-profile cable TV shows (Sex and the City reboot and Billions) showed people having heart attacks while using Peloton bikes.
I'm sure business students will use Peloton as a case study to figure out what went wrong. Hindsight is 20/20 and all that.
I believe