Peloton is slashing 800 more jobs, raising prices, and closing stores as part of the new CEO's plan to turn around the business
- Peloton will cut roughly 800 employees on its customer-service and distribution teams.
- It's the third round of layoffs in 2022 for the embattled fitness company.
Peloton is cutting jobs once again as it takes measures to revive its business.
In a memo sent to employees on Friday, Peloton said it would cut 784 roles on its customer-service and distribution teams as it shutters its in-house logistics division. Going forward, the company will instead rely on third-party companies to deliver equipment and set it up in customers' homes.
It's the third round of layoffs for Peloton this year: 2,800 jobs were cut in February and about 570 employees in Taiwan were laid off last month. Bloomberg was the first to report the latest round of layoffs.
In addition to the layoffs, Peloton will begin closing many of its retail showrooms next year, Bloomberg reported. The company also announced Friday it will raise prices on some of its equipment. The price of the Peloton Tread will go up by $800, while the high-end Bike+ will get a $500 price bump in the US. The company will implement price increases in other parts of the world as well.
A Peloton spokesperson told Insider in an emailed statement that the company took steps "to further advance our transformation strategy, better positioning the company for long term success."
"Any decision we make that impacts team members is not taken lightly, but these moves enable Peloton to become more efficient, cost effective, and agile as we continue to define and lead the global Connected Fitness category," the spokesperson said.
The changes come roughly six months after Barry McCarthy took over as Peloton's CEO amid a downward spiral for the company. Once a pandemic-era darling with a $50 billion market cap, Peloton was caught flat-footed when at-home fitness began to wane in popularity. Experts told Insider earlier this year that the company also mishandled its logistics operations, expanding quickly to meet demand before falling prey to the bull-whip effect.
McCarthy said in Friday's memo to staff that "it was never more important that we be successful in managing our turnaround."
"As we face economic uncertainty in the global macroeconomic outlook, we will continue to analyze our workforce and expenditures," McCarthy wrote. "Change is constant, and we need to embrace it and make it one of our super powers."
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