Cari Gundee rides her Peloton bike at home in San Anselmo on April 6, 2020. Due to the coronavirus (COVID-19), more people are turning towards Peloton.
CNBC learned that Peloton has stopped hiring in all departments immediately at an all-hands meeting held Friday. This was just a day after it cut its full-year outlook amid slowing sales momentum for its fitness products.
It was not immediately clear how long this hiring freeze would last.
CNBC reached out to Peloton for comment but they didn't respond immediately.
Peloton's management team hinted at analysts on Thursday during a conference phone call that they would make cost cuts in the near term to align with their slow revenue growth and slow user growth.
Jill Woodworth, Chief Financial Officer, stated that there were several areas where savings could be made.
Peloton stock fell 35% Friday at the market, wiping out more than $9 billion in market value. The shares have dropped 63% over the past year.
As the pandemic swept through, many consumers chose to stay at home and saw a rapid increase in sales for the company in 2020. Peloton made significant investments to meet this demand. For $420 million, it acquired Precor, a fitness equipment manufacturer. To speed up deliveries from overseas, it also invested heavily on air freight. It has intensified its marketing efforts in recent months to sell its original bike, which is now 20% less expensive, and a redesigned treadmill machine called the Tread.
Peloton is trying to adjust for the future as more people go back to Planet Fitness or purchase an at-home option like Tonal and Hydrow.
Peloton was on a hiring spree. According to annual filings, Peloton had 6,743 employees in the United States by June 30, which is more than twice the 3,281 employees it had a year ago.
