Peloton Interactive shares climbed on Friday, following Thursday’s plunge that wiped $2.5 billion off the fitness equipment maker’s market value. The company refuted reports that it will suspend production of its bikes and treadmills.
Thursday's CNBC report cited an internal memo suggesting that the group was planning to halt production for two months production due to a post-pandemic reduction in demand for its connected bikes and treadmills. CEO John Foley called this report 'false'. However, Foley mentioned that the group will 'reset' output levels and assess the size of its workforce and implement "significant corrective actions" in order to boost profits.
"We now need to evaluate our organization structure and size of our team," Foley mentioned. "And we are still in the process of considering all options ... to make our business more flexible."
Also, Peloton’s preliminary second quarter revenue projections is $1.14 billion. Its adjusted EBITDA forecast is in the region of -$270 million to -$260 million, vs. prior guidance of a loss of -$350 million.