Peloton announced Tuesday (Feb. 8) that it plans to cut 2,800 jobs globally, though co-founder John Foley said its instructors would not be affected, according to a Bloomberg report Tuesday (Feb. 8).
The cutbacks will reportedly eliminate roughly 20% of corporate jobs, along with making cuts to warehouses and delivery teams. Instead, it plans to rely on third-party logistics companies. Additionally, the company will not be going forward with its plans for an Ohio factory.
Foley himself lost a job, stepping down as CEO and taking up an executive chair position.
“These decisions, particularly those related to our impacted Peloton team members, were not taken lightly,” Foley said, per the Bloomberg report.
As the public faces of the company, Peloton’s instructors are tasked with building the fitness company’s cachet. The pandemic saw the company’s status skyrocket, when everyone was staying at home because of the quarantine and lockdown rules.
However, as people began returning to something approximating regular life, the company began to see things decline. Now, the company is seeing how it can stay relevant.
Those familiar with the company said instructors are paid more than $500,000 a year, with some of them leveraging their status for personal ventures. For example, head instructor Robin Arzin and Cody Rigsby, who has been on TV, have a million followers each on Instagram, and they’re also developing a special Adidas AG apparel collection.
Peloton replaced Foley with former Spotify chief financial officer Barry McCarthy, who will now also have a board seat, PYMNTS reported.
Read more: Peloton Co-Founder Foley Replaced as CEO by Ex Spotify CFO
The company also has plans to remake the board and slash overhead. McCarthy will be relocating from California to New York, and told the Wall Street Journal that his expertise is content-driven subscription models.
Activist investor Blackwells Capital recently said Peloton should investigate a sale of the company and get rid of Foley.
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