The story of Peloton Interactive, Inc is one that in normal circumstances Americans could be extremely proud of. The company was founded only ten short years ago in New York City, the brainchild of five ambitious and daring young entrepreneurs who were looking to reimagine ways for people to stay physically fit. They were a hybrid of traditional technology and a modern fitness company, and they jumped out to an exceptionally quick start.
By the time the COVID pandemic took hold in March 2020 and changed the world forever, Peloton was poised to reap the rewards of a brilliant idea and impeccable timing. As folks around the world were forced to endure draconian shutdowns and retreat to the safety of their own homes lest they risk the wrath of I’m-doing-this-for-your-own-good government officials, sales of Peloton devices, services, and merchandise rose sharply.
By December 2020, the stock price for Peloton (PTON) had soared to over $150 per share. Life was good for Peloton, and they were truly the American dream realized. Good, old-fashioned ingenuity, a lot of hard work, and a commitment to making their idea succeed. But now, in August 2022, Peloton’s star has fallen. Fast.
At the time of this writing, Peloton stock is now trading at less than $14 per share. That’s some pretty easy math to calculate, as we compute a drop in price of over 90% from that aforementioned $150+ amount. Things are so bad, Peloton, as announced yesterday, is now moving forward with their third set of employee layoffs this year.
According to Bloomberg:
“Peloton Interactive Inc. will embark on a sweeping overhaul that includes cutting nearly 800 jobs, raising prices for its Bike+ and Tread machines, and outsourcing functions such as equipment deliveries and customer service to outside companies.”
“Peloton is hoping to turn around a business that thrived during the early days of the pandemic but suffered a punishing slowdown in the past year. Revenue is declining, losses are mounting, and the company’s stock price was down nearly 90% over the past 12 months. The latest moves are an attempt to reinvigorate sales, boost efficiency and restore some of Peloton’s former cachet.”
Again, Peloton’s earlier success should have been something to celebrate for all Americans. We innovate like no other nation on earth, and Peloton was just another example of that innovation. But for many of us, particularly in the last two years, we not only declined to celebrate Peloton’s success, we’ve openly reveled in their newfound failure. In some cases, we’ve even contributed to their financial downturn by turning our backs on the company. And why? Because Peloton decided, for reasons we may never fully understand, that they needed to inject themselves into various political debates.
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During the Black Lives Matter mostly peaceful riots of 2020, Peloton didn’t just make a simple statement rejecting racism, they donated money to BLM and put forth their full-throated support of the Marxist organization. As calls for ‘defund the police’ ramped up, an effort whose consequences have been disastrous with surging crime rates across the country, Peloton was once again all-in, with vocal support for the idea. And last year, as Americans everywhere were becoming increasingly disenchanted with President Joe Biden, Peloton decided to ban the use of the term “Let’s Go Brandon” from their app. Seriously.
Peloton is thoroughly woke, to the point that they were recognized at #32 on The Blue State Conservative’s list of Woke Companies To Avoid last December, and we can be certain that their customers have recognized Peloton’s activism.
There’s no doubt these are tough times for any of us in the business world. Skyrocketing inflation is causing folks to reevaluate how they spend their money and considering that a Peloton bike starts at about $1,400 combined with a monthly fee beginning at $38, many folks would look at such expenditures as luxuries. If someone is looking for costs to cut from their budget, Peloton might be at the top of that list.
Additionally, Peloton has some stiff competition. Though they may have set the bar as trailblazers in the market, competitors such as Nordic Track are likely cutting into their market share. Running a business is complex, and there are scores of factors that can affect a company’s bottom line. But there can be no doubt that Peloton’s highly-visible commitment to wokeness has taken a toll.
Is their reduced revenue due entirely to the non-woke walking away from Peloton? Probably not, but we can safely assume that such rejections have played a role. And for anyone considering returning to Peloton, note that they have yet to backtrack on any of their previous virtue-signaling and woke lecturing, and are choosing instead to simply raise prices and fire employees. It sounds like Peloton is still a woke company worthy of our avoidance.
By Jordan Case
Jordan Case offers opinions from the unique perspective of both entrepreneur and parent and is a regular contributor to The Blue State Conservative. Jordan does not participate in the cesspool of social media.
The views and opinions expressed in this article are solely those of the author and do not necessarily represent those of The Blue State Conservative. The BSC is not responsible for, and does not verify the accuracy of, any information presented.
Notice: This article may contain commentary that reflects the author’s opinion.
Featured image: Dana L. Brown, CC BY-SA 2.0 <https://creativecommons.org/licenses/by-sa/2.0>, via Wikimedia Commons