Chris Bruzzo: Yes, do you want to start? We should start by talking about the connected fitness marketplace. I think, that’s really important. And there was significant growth leading into the pandemic, and then the extraordinary experience that everybody had during that time, especially for companies like ours that — where the in-home experience was so relevant during that time. And we are still dealing with the Whiplash, the normalizing that occurred post-COVID, and that was particularly true again for those products and experiences that we are focused on in-home. But I think we are excited to see this Connected Fitness marketplace, we are the dominant market share leader in that space, normalizing. And we can see it — as we look to the future, we can see it reaching an inflection point.
And again, reaching that kind of stable place of regular growth. And so that’s the starting point. Is the marketplace that we are in contracting or is it growing? And so we can see good signs that that market is reaching that inflection point and it’s going to return to growth. But there’s the larger question of do we know if we are investing on the right thing. I think that’s, in fact, really what the restructure — a big part of what the restructure was focused on. And so this is a sizable cut in our operating cost base, but it is — but besides the size of that impact, it is also where we made those choices. And we are intentionally going into those places where we know we can focus more. And so you are hearing me say again and again on this call, there is an opportunity for us to bring discipline, discipline to the way we approach international markets, discipline to the way we handle marketing spending, discipline to where we invest in innovation and in future growth.
So that is absolutely a primary focus here. That’s all. Anything you want to add, Liz?
Liz Coddington: Yes. The only thing I do want to add is aside from the disciplined investments and our strategy, we’re going to continue to learn and test and iterate we are going to measure on a regular basis how we’re tracking against the goals that we’ve set, and we will be able to course-correct as we get there. And one of the key things about the cost reduction program that we have implemented today is that we feel confident about where we’re in terms of generating that positive free cash flow. And that gives us the confidence that we can continue to work on different types of innovations and find the right ways to deliver a best-in-class connected fitness experience to a much broader audience over time. I think it is really clear that we do see a long-term potential backed by secular trend of people who are increasingly valuing fitness and wellness in their lives.
And that’s a trend that is clear and it is something that we can use to Peloton’s advantage because we are — we believe we are the leader in the connected fitness space.
Karen Boone: And that’s really not going away. I just want to double down on what Liz said, the trends in health and wellness exercise and fitness, they have such benefit to health and to — and they are great indicators of — and predictors of health and longevity. So people are more and more focused on that. It is not going away, people are getting more educated about it. We have a bigger role to play in that conversation as a business and as a brand. And we just have a really good mousetrap. We have premium hardware, we have interactive software. We have incredible music, are engaging and motivating instructors. And we have this community that interacts with each other. They compete alongside each other with the leaderboard.
It’s just again a really good product market fit and offering for people. There are — people are going back to the office, but not every day. Some people are going to stay working-from-home. And so at-home fitness — the connected fitness market, we’re the leader for a reason because I do think we have the best experience. And so bringing that to more and more people over time, I think, is what we really see as what’s going to happen.
James Marsh: Great. Thank you.
Operator: Thank you. I would now like to turn the call over to Karen Boone for any closing remarks.
Karen Boone: Great. Thank you. So I want to close with just reminding everyone that today is a really hard day. Change is always hard, and there is a lot of it to digest today. The restructuring we announced is especially difficult because it is impacting so much of our team. But it is a really critical and necessary step to meeting our objectives around cash flow generation and making sure the business is on solid ground and footing for the years ahead. Through all the changes over the last several years, our mission has remained constant, to connect the world through fitness, empowering people to be the best version of themselves anywhere, anytime. It has been and continues to be important and meaningful work, and we are so grateful to all the individuals who have contributed along the way. Thank you for your time.
Operator: This concludes today’s program. Thank you all for participating. You may now disconnect.
