Peloton CEO John Foley is set to step down as the company continues to struggle, taking on the role of executive chair. The exercise equipment giant is also laying off 2,800 employees amidst slow sales. The good news is that their severance packages will include a one-year membership to Peloton’s services.
The Wall Street Journal reports that Peloton, the popular exercise equipment maker, plans to replace its CEO and cut costs following a major drop in demand for the company’s exercise bikes and treadmills. Breitbart News has previously reported on Peloton’s financial issues. Last month, the company announced that from January 31 onwards, Peloton would be adding a $250 delivery and setup fee for its Bike and another $350 for its Tread, bringing the cost of the products to $1,745 for the bike and $2,845 for the treadmill.
Woman riding Peloton bike (Peloton)
Peloton previously stated that the $250 and $350 fees were included in the total price of the products. Prices for the company’s products appear to be increasing across the UK, Germany, and Australia also.
In a recent meeting of company management, Peloton Chief Marketing and Communications Officer Dara Treseder stated that the price increases were the result of growing inflation and higher supply chain expenses. CNBC obtained a recording of the meeting in which Treseder stated: “Right now, people are raising prices. Ikea just raised prices. We want to go in the middle of the pack.”
Now, the company is replacing company co-founder John Foley as CEO. Foley will be assuming the role of executive chair while former Spotify CFO Barry McCarthy will be taking on the role of Peloton CEO and president and joining the company’s board.
Peloton will also be cutting around 2,800 jobs, or 20 percent of its workforce, to cope with low demand for its products and continued losses. The company is also reportedly giving all laid-off employees a free membership to its own services. In a press release about the layoffs, the company stated: “The Peloton monthly membership will be complimentary for impacted team members for an additional 12 months.”
Peloton’s value has fallen from a high of around $50 billion a year ago when many gyms were closed worldwide due to the coronavirus pandemic, to around $8 billion last week.
Foley commented on stepping down from the CEO position, stating: “I have always thought there has to be a better CEO for Peloton than me. Barry is more perfectly suited than anybody I could’ve imagined.”
Read more at the Wall Street Journal here.
Lucas Nolan is a reporter for Breitbart News covering issues of free speech and online censorship. Follow him on Twitter @LucasNolan or email him at lnolan@breitbart.com
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