PeloÂton has grown tremenÂdousÂly durÂing the COVID-19 panÂdemÂic, but now that things are openÂing up, itâs strugÂgling to susÂtain its growth. Today, the comÂpaÂny is shakÂing things up by replacÂing its CEO, reshufÂfling the board and layÂing off about 20% of its workÂforce, accordÂing to the Wall Street Journal.
CEO and co-founder John Foley is stepÂping down as CEO to become execÂuÂtive chairÂman and will be replaced by forÂmer SpoÂtiÂfy chief operÂatÂing offiÂcer BarÂry McCarthy, the comÂpaÂny told the WSJ. McCarthy would bring his underÂstandÂing of conÂtent-driÂven subÂscripÂtion modÂels to PeloÂton. âI always thought there had to be a betÂter CEO for PeloÂton than me,â Foley said. âBarÂry is more perÂfectÂly suitÂed than anyÂone I could have imagÂined.â On top of that, the comÂpaÂny is cutÂting around 2,800 positions.
In addiÂtion to its finanÂcial strugÂgles, PeloÂton has been hit with bad press regardÂing equipÂment safeÂty, unpaid employÂees, and even not-so-posÂiÂtive menÂtions on recent TV shows. As the comÂpaÂnyâs valÂue fell from a high of $50 bilÂlion to around $8 bilÂlion last week, it has been the subÂject of takeover rumors from AmaÂzon, Nike and even from Apple.
PeloÂton will disÂcuss its plans for dealÂing with the criÂsis in more detail when it releasÂes its secÂond quarÂter results latÂer today. It is expectÂed to cut costs by $800 milÂlion and halt develÂopÂment of its $400 milÂlion facÂtoÂry in Ohio, among othÂer changes.
the comÂpaÂny reportÂed $1.14 bilÂlion in revÂenue in JanÂuÂary, preÂlimÂiÂnary to the secÂond quarÂter and said it had 2.77 milÂlion subÂscribers. Its earnÂings call is set for 5:00 p.m. GMT today.
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