This morning, Peloton announced a number of sweeping changes to the company.
First, Peloton revealed a number of leadership changes, including that Peloton CEO John Foley will be stepping down from CEO, and becoming Executive Chair. William Lynch, Peloton’s President, will be stepping out of that position to become a executive director on the board.
Taking both of their places will be Barry McCarthy, who is becoming Peloton’s CEO & President. Barry was formerly with Spotify and Netflix.
Jill Foley will also be stepping out of her role as the VP of apparel in the coming months.
The company also announced some restructuring plans.
First, the company announced they would be right sizing the organization. This includes “reduction of approximately 2,800 global positions”, and cutting corporate positions about 20%.
Peloton specifically notes that instructors are not being included in these layoffs – “Peloton’s roster of instructors and breadth and depth of its content will not be impacted by the initiatives announced today.”
Additionally, Peloton will be closing their US based manufacturing plant that was in development – the Peloton Output Park. They now feel like their third party manufacturers, including Rexon and Tonic, can handle the capacity. “The company is winding down the development of its Peloton Output Park (POP) manufacturing plan. This will result in $60 million in restructuring capital expenditures, which is included in the company’s revised full year guidance. In addition, Peloton will optimize its logistics network by reducing its owned and operated warehousing and delivery footprint, while scaling third party relationships.”
John Foley published an open letter to his team covering some of these topics, and providing more context.
John Foley had an interview with The Wall Street Journal this morning, where he was asked about the recent acquisition rumors. His reply was simply that “We are open to exploring any opportunity that could create value for Peloton shareholders.”
Peloton’s earnings call, which was previously scheduled for 5:00pm, will now take place at 8:30am ET.
This is a developing story.
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