Aug 12 (Reuters) – Peloton Interactive Inc (PTON.O) On Friday, it said it would cut jobs, close stores, raise prices on fitness equipment including treadmills and top-end bikes, and undertake a company-wide restructuring to boost its revenue and improve cash flow.
Shares of the company rose about 11% in afternoon trading after the company said in a note that it would cut 800 jobs and reduce its retail presence in North America.
Under CEO Barry McCarthy, Peloton has implemented a number of measures, including cost cuts, to shore up its business as demand for its treadmills and exercise bikes is spurred by a pandemic.
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On Friday, the company outlined plans to drastically scale back its retail operations in the United States and eliminate many jobs in warehouses and customer support teams.
Shifting final-mile delivery to third-party logistics providers could cut per-product delivery costs by up to 50%, McCarthy said in a memo seen by Reuters.
The company is raising the prices of its Bike+ and Tread machines in five markets, including the US and Canada. (https://bit.ly/3peZhNv)
The company, which cut prices on its products earlier this year, now says it will raise prices on the Bike+ by $500 to $2,495 and the Tread by $800 to $3,495 in the US.
McCarthy, a former Netflix Inc (NFLX.O) The executive said he aims to bolster Peloton’s software engineering team, citing the “right investments” to fuel growth.
($1 = 1.2782 Canadian dollars)
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Reporting by Nathan Gomez and Kannagi Deka in Bangalore; Additional reporting by Deborah Sophia; Editing by Krishna Chandra Eluri and Anil de Silva
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