Peloton in the US Ultimately Replaces Many Executives Including Founder and Chairman John Foley

[Image source=AP Yonhap News]

[Asia Economy Reporter Jeong Hyunjin] Peloton, a U.S. fitness equipment manufacturer that struck gold during the COVID-19 pandemic but has recently been suffering massive losses due to declining endemic demand, has decided to replace a large portion of its management team, including its founder.

According to the Wall Street Journal (WSJ) and others on the 12th (local time), Peloton announced that John Foley, co-founder, will resign from his position as chairman of the board. Foley, who founded Peloton in 2012, has led the company for the past decade, from starting bicycle sales in 2014 and opening a Manhattan studio to the initial public offering (IPO) in September 2019. Along with Chairman Foley, other executives including Chief Legal Officer (CLO) Hisao Kushi and Chief Commercial Officer (CCO) Kevin Cornils will also leave the company.

This management reshuffle was carried out by current Peloton CEO Barry McCarthy, who took over the CEO position after Foley stepped down in February. CEO McCarthy warned in the Q2 earnings report that the company suffered a loss of $1.2 billion (approximately 1.7 trillion KRW) and that sales dropped by about 30%, cautioning in August that costs could exceed revenues in the coming months.

Peloton expanded its business benefiting from the COVID-19 pandemic, but insider trading allegations, a sharp drop in demand, and market downturns have combined to cause its stock price to plummet nearly 70% this year. Recently, the stock price saw a surprise rebound following news that Peloton would end exclusive sales and partner with Amazon, but the aftershocks of demand decline due to the endemic continue. Following the management reshuffle announcement, Peloton’s stock price rose by over 5% in after-hours trading but later fell again, showing a decline of around 2%.

Bloomberg reported, "With founder Foley stepping down, CEO McCarthy will have more freedom to change the company," noting McCarthy’s earlier remarks that he needs to prioritize providing digital services beyond hardware and consider whether to secure subscribers who watch content on smartphones rather than Peloton-exclusive equipment.

Foley stated, "It’s time for me to start a new professional chapter," adding, "I am interested in building companies and great teams, and I’m excited to do that again in a new space." WSJ reported that as of October last year, Foley held about 40% of Peloton’s shares, and Peloton declined to comment on this matter.

This content was produced with the assistance of AI translation services.