The Week in Business: Hard Times in the Peloton


At the start of the pandemic, with gyms closed and people stuck at home, demand for Peloton’s bikes and virtual classes skyrocketed. Just like its share price. But sales growth has slowed as gyms and fitness studios reopen. The company’s outlook hasn’t been helped by a recall of its treadmills for safety reasons and fictional characters suffering heart attacks while riding bikes in not just one, but two popular TV shows. . Peloton was forced to curb, halt production of its bikes and treadmills, cancel plans for a new factory in Ohio and announce on Tuesday it would lay off 2,800 workers, or about 20% of its workforce. Company founder John Foley said he would step down as chief executive and become executive chairman. Barry McCarthy, former chief financial officer of Spotify, has been named chief executive and chairman.

Speaking of hills, prices continued their strong upward trajectory in January, according to new figures released Thursday by the Department of Labor. The consumer price index, a key gauge of inflation, showed prices rose 7.5% over the past year. While car price increases, which were primarily driven by pandemic-related supply chain issues, have moderated somewhat, the cost of food, rent, electricity and other services continued to rise, suggesting that there are more than just pandemic factors at play. This could put more pressure on the Federal Reserve to cool the economy. Investors now expect the Fed to raise interest rates by half a point in March, rather than its usual quarter-point hike.

The Biden administration has made cracking down on corporate consolidation a priority, an effort that began last year with the hiring of the most aggressive competition-fighting team in decades. Regulator concerns came into play in several big deals last week. On Monday, Silicon Valley chipmaker Nvidia said it would end its efforts to buy Arm, which licenses chip technology, due to “significant regulatory challenges”. On the same day, Spirit Airlines and Frontier Airlines announced plans to merge, a deal that would create the fifth-largest airline in terms of market share and could also face opposition from regulators. (The Department of Justice sued to stop the merger of American Airlines and JetBlue Airways last year.) to keep Activision franchises like Call of Duty available on other platforms and not to force game makers to use its payment systems. And Discovery and AT&T cleared a significant regulatory hurdle on Wednesday in their deal to combine Discovery and WarnerMedia, which would create one of the largest media companies in the United States.

In the latest sign that crypto has become mainstream — if not in transactions, in conversation — at least three online services for buying and selling cryptocurrency will run ads during Sunday’s Super Bowl. Brands that have little or nothing to do with blockchain, including Bud Light, Expedia, and TurboTax, will also reference the technology in their ads. About 100 million people are expected to watch the game between the Los Angeles Rams and the Cincinnati Bengals, and NBC Universal charged up to $7 million for a 30-second commercial during the event.


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