Peloton CEO Barry McCarthy put out a public memo today, in an attempt to clarify reporting earlier around Peloton’s business – in which it was reported Peloton had six months to prove it could still operate as a standalone business and not be sold. Peloton had provided some quotes to the Wall Street Journal to try to provide context around the news that Peloton was laying off 500 employees today.
Barry’s updated statement in response to the report this morning in part said:
I joined Peloton for the comeback story, not to sell the business. And today the business is fundamentally more sound than ever and on the right path, so to be clear, there is no timeclock nipping at our heels. If my comments to the WSJ suggested otherwise, then I misspoke, as that is simply not true.
He further clarified this in an email to the internal Peloton team, as first reported by @mylesgrote on Twitter.
Team,
I’m sure you all have seen of heard about today’s Wall Street Journal story. We were expecting a story about redemption and the successful turnaround of Peloton, which is why we invested time on background briefing them on the state of our turnaround. The headline should have been that recent strong execution and today’s restructuring have positioned us to meet our fiscal year-end goal of break-even cash flow, with a renewed focus on accelerating our growth, which is why I’ve never felt more optimistic about our future. Would I say tis if it weren’t true? Not a chance…..
Instead, the article creates the impression we have six months to live, which is at odds with the story we told and the state of the business. That’s on me and I apologize.
I was asked the question: “How much time do you think you have to show success?” My response was 12 months from the time I joined Peloton, knowing that we’re already showing significant progress, and in record time. Seemed like a no-brainer at the time.
In the past you’ve heard me say we’re all held accountable for our performance. Me included. But to be unequivocally clear, there is no ticking clock on our performance and even if there was, the business if performing well and making steady progress towards our year-end goal of break-even cash flow. Our immediate focus is on ensuring that our most important stakeholders – beginning with you – understanding this to be the case.
Most importantly, I don’t want this news cycling to overshadow the difficult reality that 500 of our colleagues have been impacted today, or for the gratitude I have for all they and you have done for the company.
-Barry
You can read Barry’s full official public statement on the Peloton investor site here, or embedded below:
Today, Peloton (NASDAQ: PTON) announced approximately 500 global team member positions have been eliminated, as part of the final phase of the company’s transformation journey. The restructuring of Peloton’s business and capital structure to assure its long-term health is complete, and management’s focus is now on growth. CEO and President Barry McCarthy reinforces his belief in the lasting resilience of the Peloton business and thanks departing team members for their contributions to the business:
“I joined Peloton for the comeback story, not to sell the business. And today the business is fundamentally more sound than ever and on the right path, so to be clear, there is no timeclock nipping at our heels. If my comments to the WSJ suggested otherwise, then I misspoke, as that is simply not true.
Restructuring a business requires difficult decisions that affect people’s lives. I’m grateful for the many contributions of those who have been impacted. The changes we have made, combined with the performance of the business, are moving us closer to our fiscal year-end goal of break-even cash flow, with a renewed focus on growth. We are in the business of driving performance, and the business is indeed performing. By any measure, we have made remarkable progress in record time.”
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