Peloton was once considered a promising company with a massive valuation of $50 billion, but the company dropped to just $8 billion in value over the past year. Several reports imply that Nike and Amazon are now planning on buying the exercise equipment company.
Amazon 'has been Consulting Its Advisers' on Possibility of Purchasing Peloton?
According to an article by The Wall Street Journal, Amazon, the e-commerce and cloud giant, "has been consulting its advisers" regarding the possibility of them purchasing Peloton. To add, Amazon might not be the only company contemplating purchasing Peloton.
An article by The Financial Times states that another company, Nike, is also thinking of buying the exercise equipment maker. With that, neither company has talked directly with Peloton yet, "and they may end up not making an offer at all."
Peloton's Rise to Popularity During the Start of the Pandemic
During the pandemic, Peloton became a huge hit, with a lot of people looking for alternatives to fitness after the lockdowns caused the gyms to close. At the start of 2021, Peloton reached a market value of $50 billion, far from its current $8 billion valuations.
The company halted the production for its Bike and Tread amid the demand slowing down due to a number of factors, including "stiffer competition," as per a report by CNBC in January.
Workers' Issues within the Company
John Foley, the CEO of Peloton, denied later on that the company was pausing its production in a letter towards the company's employees. The CEO, however, did admit that the company is "resetting [its] production levels for sustainable growth."
An article by BuzzFeed News dove deeper and stated that a number of workers claimed that the company owed them money for unpaid labor. In addition to the story, workers were accusing the company of not paying for overtime done during breaktime and even "not reimbursing them for company expenses."
Read Also: Amazon Announces Plans to Add to Its 70K Workforce in the UK by Creating 1.5K Apprenticeships
What Would Happen If Amazon Bought Peloton?
According to the story by Engadget, should Amazon acquire Peloton, it could use the company for them to "expand its health and wellness offerings" as well as make sure that it becomes easier for customers to get one of its bikes or treadmills.
The Journal notes that Amazon buying Peloton would give the company more access to users' data, which could also help them when it comes to future health and wellness projects. As of the moment, however, Peloton hasn't dropped any hints regarding the company "looking for a new owner/"
An article by Reuters reported that both Peloton and Nike did not give any immediate response to their request for comment. Amazon, on the other hand, denied giving a comment.
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This article is owned by Tech Times
Written by Urian B.
