A hiring freeze set in, and Black employees voiced concerns over their pay compared with the industry standard. In the meantime, Peloton had been taking reputational hits. Peloton filed a lawsuit against them in November, accusing them of patent infringement. Peloton was also being chased by rivals like Echelon and iFit Health, which offer similar, cheaper products. "It is clear that we underestimated the reopening impact on our company and the overall industry," Foley said in a call with shareholders. The company's stock dropped 34% following its fiscal first-quarter earnings in November, which included a dismal outlook for the months ahead. A year after the "Peloton wife" ad, the company's market value had hit $34 billion.Īs the nation continued to move toward reopening - and returning to the gym and fitness studios - Peloton's business took a punch. Still, 2020 was all around a stellar year for Peloton that included debuting new, higher-end versions of the bike and treadmill and inking a multi-year deal with Beyoncé. After 120 reports of bikes breaking and 16 reports of customers getting injured, the company issued a recall affecting 30,000 bikes. The company took weeks or months to make repairs, further frustrating users. Then, some customers began experiencing issues with their bikes where pedals snapped off mid-ride. Delivery times for new equipment became longer and longer, and Peloton's typically diehard fans began expressing their frustration online. In September of that year, Peloton said that it had had its first profitable quarter, with sales spiking 172% since the same quarter the year prior and revenue rising to $607 million.īut the unexpected uptick in demand showed the cracks in Peloton's logistics operation. By May 2020, Peloton reported a 66% increase in sales and a 94% increase in subscribers.
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