Peloton Cut its Financial Outlook for the full year on Tuesday
Feb 8, 2022 By MarketDepth
Peloton (NASDAQ: PTON) cut its financial outlook for the full year on Tuesday, following news that CEO John Foley would be stepping down amid a new restructuring plan. Furthermore, the company is set to slash approximately 20% of its workforce in order to keep the business afloat.
Revenue Lower than Forecast
The fitness company now expects fiscal 2022 revenue to range anywhere from USD3.7 Billion to USD3.8 Billion, lower than its previous forecast of USD4.4 Billion to USD4.8 Billion. Peloton also expects to finish the year off with about 3 million fitness subscribers, lower than its previous outlook of 3.35 million to 3.45 million.
“We are taking steps to best position Peloton for sustainable growth, while also establishing a clear path to consistent profitability.”CEO John Foley
The American exercise company also revealed plans to lay off about 2,800 employees, an action which Foley had hinted at just a few weeks ago. Additionally, it has opted to reduce the number of warehouses it owns and operates, saving the company USD800 Million in annual costs.
Layoffs Start Tuesday
“This restructuring program is the result of diligent planning to address key areas of the business and realign our operations so that we can execute against our growth opportunity with efficiency and discipline,” the company said in a press release. Layoffs also begin Tuesday.
However, Peloton highlighted that on-camera instructors and content “will not be impacted by the initiatives announced today.”