Peloton CEO Barry McCarthy has announced his resignation, citing a decrease in demand for the company’s connected fitness equipment following the pandemic. The New York-based company is cutting 15% of its workforce and has appointed Karen Boone and Chris Bruzzo as interim co-CEOs, with Jay Hoag serving as board chairperson.
McCarthy acknowledged the difficult decision to reduce headcount and expressed confidence in Peloton’s future with the current leadership team. Despite setbacks, McCarthy highlighted that sales surged during the pandemic due to gym closures prompting individuals to seek at-home fitness solutions. However, sales declined as restrictions lifted, leading McCarthy to implement cost-cutting measures in an attempt to transform Peloton into a subscription-based model.
Peloton’s shares saw an 8% increase prior to market open after revealing intentions to scale back retail operations until demand picks up again. The company was once valued at over $50 billion but is now worth $1.1 billion after various strategies introduced under McCarthy’s leadership failed to address financial challenges despite partnerships with major brands and a shift towards corporate wellness. The board is currently in the process of selecting the next CEO following McCarthy’s departure.
