Today, Zwift announced it is making 15 per cent of its current workforce redundant, as reported by Bicycle Retailer and Industry News. It appears that Zwift is the latest company to shrink its workforce in order to stay afloat within the contracting, post-pandemic industry bubble. This is the third reported round of layoffs in just under a year from the giant of indoor cycling, who in May 2022 laid off 150 staff and cancelled plans for its Tron Bike exercise bike project before further cuts later in the year.
"After very careful consideration, we have taken the decision to make important changes to the organization. These changes mean we will regretfully be parting ways with a number of very talented colleagues. We are grateful for their contributions to Zwift and will do our best to support them in their transition", a Zwift spokesperson is quoted as saying.
It is reported that the majority of the layoffs will hit HR and marketing departments, with the aim of allowing the company to invest more in other areas, and develop faster. It is understood that Zwift will honour its current sponsorship arrangements and marketing campaign commitments.
This news follows a similar story from Specialized, whose global layoffs in January affected 8 per cent of the company; presumably part of the same internal restructuring that saw Machines For Freedom dissolved and ties cut with swathes of its ambassadors.
It appears restructuring is behind Zwift's motivations, too. "Scaling back in some areas will allow us to invest more heavily in our product," the spokesperson continued. "The changes we have made will allow us to further increase the speed of development, adding greater value to our customers through new experiences and more engaging content."
The cycling industry is experiencing a noticeable contraction following the unsustainable boom which occurred during the pandemic, and in recent months, we've seen a slew of headlines regarding poor profits and layoffs.
Most recently, industry titan Shimano predicted a difficult 2023 in January, despite making record profits for a second consecutive year. We've also seen two rounds of layoffs at Wahoo, one of which coincided with a 15% cut at Strava, and layoffs and an office closure at Pearl Izumi.
Notable too is the fate of Rad Power Bikes, which has also gone through three rounds of redundancies. Electric bikes were perhaps the biggest boom sector during the pandemic, so may well be seeing the fastest corresponding contraction.
"All departing colleagues will receive a generous severance and career support to help them in their transition," the Zwift spokesperson concluded.
