Peloton crashes to record low as CEO quits amid layoffs

Already a subscriber?the struggling fitness companyThe board will conduct a search to name a replacement, Peloton said in a statement Thursday. Board Chair Karen Boone and director Chris Bruzzo will serve as interim co-CEOs.The shares fell as much as 16 per cent to $US2.71 in New York on Thursday, marking the worst intraday drop since February. Even before the decline, the stock was down 47 per cent this year.

The executive also forged new partnerships, including one this week with Hyatt Hotels to bring Peloton bikes to the hotel chain in an attempt to boost sales.But McCarthy acknowledged in recent months that the company continued to struggle with growing “at scale” and warned in February that revenue may not start increasing again until the fourth quarter.The New York-based company was a high flyer during the early days of the pandemic, when lockdowns sentand fitness classes.

“The objective of the cost reductions is to align our cost structure with the current size of our business and position Peloton to generate sustained and meaningful positive free cash flow, which is a top priority for us” the company said in a statement. Peloton said it’s working closely with its banks, including JPMorgan Chase & Co. and Goldman Sachs on a refinancing strategy.

Peloton narrowed its guidance for revenue for this fiscal year, and the new range came in lower than analysts anticipated. The company now predicts sales of $US2.68 billion to $US2.70 billion for the full year. It also is anticipating 2.96 million to 2.98 million connected fitness subscribers, lower than a previous forecast for as much as 3.01 million.

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