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Peloton CEO Barry McCarthy Steps Down as Company Begins Restructuring

Peloton Interactive has begun a search for a new CEO and announced that Barry McCarthy has stepped down as CEO, president and board director.

Chairperson Karen Boone and Director Chris Bruzzo will serve as interim co-CEOs, while Director Jay Hoag has become the new chairperson of the board of directors, the connected fitness company said in a Thursday (May 2) press release.

McCarthy, who led Peloton for the past two years as CEO, will serve as a strategic advisor to the company through the end of the year, according to the release.

Peloton announced the leadership transition on the same day it reported its quarterly earnings and said it has begun restructuring efforts that include laying off about 400 employees — about 15% of its global headcount — and reducing its retail showroom footprint to reduce costs.

Announcing the leadership transition, Boone said that McCarthy joined Peloton “during an incredibly challenging time for the business.”

“During his tenure, he laid the foundation for scalable growth by steadily rearchitecting the cost structure of the business to create stability and to reach the important milestone of achieving positive free cash flow,” Boone said in the release. “With a strong leadership team in place and the company now on solid footing, the board has decided that now is an appropriate time to search for the next CEO of Peloton.”

Boone and Bruzzo added in the release that, as interim co-CEOs, they aim to “ensure the company doesn’t miss a beat while the CEO search is underway.”

Hoag said in the release: “The board is focused on identifying a new CEO who possesses the ideal combination of skills, experience and vision to execute Peloton’s exciting next chapter and drive shareholder value.”

McCarthy, a former Spotify chief financial officer, joined Peloton in February 2022, replacing co-founder and then-CEO John Foley.

At the time, Peloton was preparing to overhaul its board, slash overhead and lay off 2,800 people, 20% of whom were executives.

In January 2022, it was reported that the firm’s stock fell over 80% from its all-time high and was trading below its September 2019 initial public offering (IPO) price. The stationary bike maker had done well during the pandemic when everyone was stuck inside due to quarantine precautions.