Peloton has laid off another 500 workers, the latest in a string of job cuts as the connected fitness company executes a major financial turnaround plan.

First reported by The Wall Street Journal, the latest layoffs make up 12% of Peloton's remaining workforce. According to the WSJ, CEO Barry McCarthy, who took on the chief executive role in February, said he was giving Peloton another six months to improve financially, or it may not succeed as a stand-alone company.

However, in a statement released yesterday, McCarthy said he believed in the resilience of the business. 

"I joined Peloton for the comeback story, not to sell the business. And today the business is fundamentally more sound than ever and on the right path, so to be clear, there is no timeclock nipping at our heels. If my comments to the WSJ suggested otherwise, then I misspoke, as that is simply not true," he said.

THE LARGER TREND

The connected fitness company has struggled financially after a boom during the height of the COVID-19 pandemic. Peloton reported a $1.2 billion loss during its fourth quarter ended June 30, with revenue falling 28% from the same period in 2021.

In February, the company cut around 2,800 jobs, around 20% of its corporate workforce. It also replaced cofounder John Foley with McCarthy, who had previously served in executive positions at Spotify and Netflix. Foley stepped down from his role as executive chair of the board last month. 

The company also ceased manufacturing its own connected bikes and treadmills, outsourcing production to Taiwanese company Rexon Industrial Corp. That move resulted in about 570 layoffs in Taiwan. The company also cut about 800 customer service and logistics jobs in August. 

ON THE RECORD

"Restructuring a business requires difficult decisions that affect people's lives. I'm grateful for the many contributions of those who have been impacted. The changes we have made, combined with the performance of the business, are moving us closer to our fiscal year-end goal of break-even cash flow, with a renewed focus on growth," McCarthy said in a statement.

"We are in the business of driving performance, and the business is indeed performing. By any measure, we have made remarkable progress in record time."