Peloton announced Thursday that CEO Barry McCarthy will be stepping down and the company will lay off 15% of its staff as it looks to cut costs by $200 million.
McCarthy, a former Spotify and Netflix executive, will become a strategic advisor to Peloton through the end of the year while Karen Boone, the company’s chairperson, and director Chris Bruzzo, will serve as interim co-CEOs. Jay Hoag, another Peloton Director, has been named the new chairperson of the bard. Peloton is seeking a permanent CEO.
The company also announced a broad restructuring plan that will see its global headcount cut by 15%, or about 400 employees. It plans to continue to close retail showrooms and make changes to its international sales plan.
The restructuring is designed to realign Peloton’s cost structure with the current size of its business, it said in a news release.
“This restructuring will position Peloton for sustained, positive free cash flow, while enabling the company to continue to invest in software, hardware and content innovation, improvements to its member support experience, and optimizations to marketing efforts to scale the business,” the company said. “Upon full implementation, the company expects the plan to result in reduced annual run-rate expenses by more than $200 million by the end of its 2025 fiscal year.”
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