OT-ish Peloton temporarily halts production of bikes, treadmills

[fiamme red]

Don't cry for Peloton instructors. They'll get by.

https://time.com/6187968/peloton-ins...-money-famous/

Still, more followers translate to more money. “It wouldn’t be surprising to me if instructors like Cody and Robin are getting close to $20,000 per post on average,” says Watson of NYU. Asked how much she makes from outside endorsements, Arzón is coy. “It’s more than my income at Peloton,” she says. “Let’s just say it’s a few salaries.”

Very few instructors have left the Peloton family, in part because they’re afforded so much leeway. But this freedom isn’t the only reason they stay. A Bloomberg report from January 2021 found that senior instructors made $500,000-plus in compensation. A recent earnings report nodded to their value, noting that Peloton’s declining stock price may hamper its ability to hire and retain top-tier fitness talent who are offered shares in the company. “If they haven’t left the Peloton ecosystem, it’s almost certainly because Peloton has signed them to exclusive contracts where they’re paying them several million dollars,” Watson says. (A Peloton spokesperson said the company does not comment on employee compensation.)

[echelon_john]

And the inevitable cost-slashing continues…
https://www.wsj.com/articles/peloton...ns-11657624590

[unterhausen]

Originally Posted by echelon_john

And the inevitable cost-slashing continues…

paywall, right? Can you summarize?

[echelon_john]

Sorry ‘bout that. The gist is that Peloton will no longer manufacture any equipment. All physical goods-bikes, treadmills, etc will be produced by 3rd party vendors. Looks like they’re betting that those cost efficiencies and a focus on software will enable them to survive. Tough to see the quality of the bikes etc remaining steady given that structure plus cost-cutting imperatives.

Originally Posted by unterhausen

paywall, right? Can you summarize?

[ktakashismith]

Originally Posted by echelon_john

Sorry ‘bout that. The gist is that Peloton will no longer manufacture any equipment. All physical goods-bikes, treadmills, etc will be produced by 3rd party vendors. Looks like they’re betting that those cost efficiencies and a focus on software will enable them to survive. Tough to see the quality of the bikes etc remaining steady given that structure plus cost-cutting imperatives.

Brutal, so Peloton has just become a software platform. I wonder who will build their bikes, NordicTrack? Also, what's gonna happen to all those first-generation Peloton products in the coming years, will they just give people a voucher towards a new third-party-produced product if their current equipment craps out within warranty...so many questions.

[martl]

I noticed Peloton have a showroom in my home town Munich, at just about the most exclusive and expensive spot (Odeonsplatz). Before they moved in, it was an Aston Martin showroom...

[yngpunk]

Originally Posted by ktakashismith

Brutal, so Peloton has just become a software platform. I wonder who will build their bikes, NordicTrack? Also, what's gonna happen to all those first-generation Peloton products in the coming years, will they just give people a voucher towards a new third-party-produced product if their current equipment craps out within warranty...so many questions.

Peloton equipment will be manufactured by Rexon, a Taiwanese company that makes everything from power tools to fitness equipment. NordicTrack is manufactured by Icon Health and Fitness, based in Logan, UT

[Veloo]

Not sure if this has already been posted.

Now a $19M fine.
This makes it sound more treadmill centric tho.

https://cyclingmagazine.ca/sections/...-million-fine/

[reuben]

I'm dredging up this old thread in an effort to keep the information all in one place.

Peloton Interactive stock was rising sharply Thursday after the at-home fitness company announced its CEO was stepping down and that it would be cutting jobs under a new cost-saving initiative.

Peloton Chief Executive Officer Barry McCarthy, who took the position in 2022, is stepping down, the company said in a news release. His leave comes after shares have dropped 92% since he became CEO and 58% over the last 12 months.

Current Peloton Chairperson Karen Boone and board director Chris Bruzzo will serve as interim co-CEOs until the company completes its search for McCarthy’s replacement.

Peloton also announced new cost-cutting initiatives in order to “align the company’s cost structure with the current size of its business.” This includes cutting 15% of its global headcount, or about 400 jobs.

[merckxman]

".....former billionaire CEO John Foley says his wealth has been wiped out...."
https://fortune.com/2024/08/27/pelot...s-possessions/

[benb]

Hadn't followed this in a while but getting out of building bikes was of course a GREAT business move.

There is absolutely no way they want to be building bikes. Even if they are involved in the design they want to be letting someone else do as much of the low margin stuff as possible.

Software is very high margin. But instagram star instructors will continue to be low margin.

I haven't heard anyone mention this kind of stuff in ages and I haven't seen anyone upload a Peloton ride to Strava in a long time either.

I am not sure what the new fitness craze even is.. is there one? I think the only boutique fitness place left near me is a Barre place and an Orange theory fitness everything has been nuked from orbit including the Crossfit box.

[ridethecliche]

Originally Posted by benb

Hadn't followed this in a while but getting out of building bikes was of course a GREAT business move.

There is absolutely no way they want to be building bikes. Even if they are involved in the design they want to be letting someone else do as much of the low margin stuff as possible.

Software is very high margin. But instagram star instructors will continue to be low margin.

I haven't heard anyone mention this kind of stuff in ages and I haven't seen anyone upload a Peloton ride to Strava in a long time either.

I am not sure what the new fitness craze even is.. is there one? I think the only boutique fitness place left near me is a Barre place and an Orange theory fitness everything has been nuked from orbit including the Crossfit box.

I see people upload peloton rides to strava all the time. Esp in the tri-group that i'm in!

[benb]

Apparently Foley walked away with $225 million so I'm not sure how that's losing everything.

More like winning big while being a business failure. Sounds great. Retire and be done with it all.

Their valuations were truly bonkers even if they'd been a "real" tech company with no marginal costs and massive margins.

[unterhausen]

I have seen info about using your peloton with cycling related apps like zwift, so they probably will be okay for a while.

I never saw them as part of the bike industry, but of all the bike-adjacent companies they may have navigated the pandemic worse than anyone. If you can't be first, be last.

I'm kind of glad the ex-ceo lost a lot of money. Starting with stealing an actual cycling word as their brand.

[LegendRider]

Originally Posted by benb

Apparently Foley walked away with $225 million so I'm not sure how that's losing everything.

More like winning big while being a business failure. Sounds great. Retire and be done with it all.

Their valuations were truly bonkers even if they'd been a "real" tech company with no marginal costs and massive margins.

One article says he still spends the weekends in the Hamptons, so...