Peloton is replacing its CEO and cutting around 2,800 jobs


Peloton CEO John Foley plans to step down and become executive chair after a decline in demand and a production halt led to a steep sell-off of the company's shares, the Wall Street Journal reports.

The exercise bike maker also plans to cut about 2,800 jobs, which represents about 20% of its corporate workforce, according to the Journal.

  • Foley, a former Barnes & Noble executive who co-founded Peloton over 10 years ago, will be replaced as CEO by former Spotify and Netflix CFO Barry McCarthy.
  • Peloton's value had dramatically fallen after a reported cut in production levels before rebounding in recent days over reports that Amazon and others may be interested in purchasing the company.
  • Last month, a hedge fund with less than a 5% stake in Peloton called for Foley to be fired and for the connected fitness company to consider seeking a strategic buyer, Axios' Dan Primack reported.

Foley and other company insiders control more than 80% of Peloton's voting shares, per the Journal, meaning he would likely have veto power over any deal.

"We are open to exploring any opportunity that could create value for Peloton shareholders," Foley told the paper.

Peloton on Tuesday slashed its financial outlook for the full year after the company announced CEO John Foley will be stepping down, as part of a broader restructuring of the business.

It sees fiscal 2022 revenue within a range of $3.7 billion to $3.8 billion, down from a prior range of $4.4 billion to $4.8 billion.

It said it expects to end the year with about 3 million connected fitness subscribers, versus previous estimates for 3.35 million to 3.45 million.

Peloton shares were falling more than 8% in extended trading.

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