As of press release, the stock is down more than 13%, and the stock price hit a record low of $2.7
The Zhitong Finance App learned that Peloton (PTON.US) announced on Thursday that CEO Barry McCarthy will step down and that the company will lay off 15% of its employees because “there is no other way to keep expenses in line with revenue.”
McCarthy is a former Spotify (SPOT.US) and Netflix (NFLX.US) executive, and he will continue to serve as Peloton's strategic advisor until the end of this year. Meanwhile, the company's board chairman Karen Boone and director Chris Bruzo will serve as interim co-CEOs. Jay Hoag, another director of Peloton, has been appointed as the new chairman of the board. Peloton is currently looking for a permanent CEO.
The company also announced an extensive restructuring plan to reduce its global workforce by 15% to around 400 employees. The company plans to continue closing retail showrooms and making adjustments to international sales plans.
These initiatives are aimed at realigning the cost structure according to the size of its current business. This is expected to reduce annual operating expenses by more than $200 million by the end of fiscal year 2025, the company said in a press release.
“This restructuring will enable Peloton to continue to achieve positive free cash flow while enabling the company to continue to invest in software, hardware and content innovation, improve the member support experience, and optimize marketing efforts to scale up the business,” the company said.
As of press time, the stock was down more than 13%, and the stock price hit a record low of $2.7.