Private equity firms reportedly considered buying Platoon.
At least one company has spoken with Peloton about going private, and a number of other companies have considered an acquisition but may or may not have spoken with the company, CNBC reported Tuesday May 7, citing anonymous sources.
A deal may not be reached and Peloton may remain a public company, according to the report.
When asked by CNBC about these reports, a Peloton spokesperson said, “We do not comment on speculation or rumors,” according to the report.
These discussions come at a time when Peloton’s market capitalization fell to $1.3 billion as of Monday, May 6, down from its peak of $49.3 billion in January 2021, according to the CNBC report.
The company still has a profitable subscription business, but it has struggled with the cost of manufacturing its bikes and treadmills, recalling the high level these products have enjoyed, and the reduction in large purchases by consumers of all income groups, per the report.
On Thursday, May 2, Peloton announced the launch of restructuring efforts that include laying off about 400 employees – about 15% of its global workforce – and reducing its retail showroom footprint to mitigate costs.
The announcement, which coincides with its third-quarter financial results report, is part of the company’s broader strategy to reduce annual spending by more than $200 million by the end of fiscal 2025 .
“The goal of the cost reductions is to reshape Peloton to align our cost structure with the current size of our business and position Peloton to generate sustainable and meaningful positive free cash flow, which is a top priority for us,” CFO of Peloton. Liz Coddington said May 2 during the company’s quarterly earnings call.
The same day, the company announced a change of direction who understood Barry McCarthy resignation as CEO, president, director and chairman of the board of Peloton Karen Boone and director Chris Bruzzo step in to serve as interim co-CEO.
McCarthy joined Peloton in February 2022, at which time the company was preparing to reshuffle its board, cut overhead costs and lay off 2,800 people.
