Peloton’s new CEO on the company’s future

Fitness brand Peloton and its workforce has had a rocky few months. After a stellar 2020 with the closure of gyms and people moving to exercise in their own homes, 2021 brought financial challenges, which were compounded by supply chain issues.

Its share price plummeted by almost 80% over the year, and it lose $439 million in the last quarter.

As a result, Peloton made the difficult decision to lay off 2,800 employees (this represents 20% of its corporate workforce). Its founder John Foley also announced he would step down as CEO, and make way for a new CEO Barry McCarthy, who has previously worked as CFO at Spotify and Netflix.

McCarthy has already been grappling with disgruntled employees (both former and current) in an All Hands meeting where he was first introduced to Peloton’s workforce.

But now he has addressed Peloton’s future as a business and as an employer in an interview with the New York Times.

McCarthy, Peloton and the future of work

Despite the situation at the All Hands meeting, which he is clear was not cut short as reported by many outlets, McCarthy believed he’s “been well received” by the employees.

“Do I worry about being charismatic enough to lead a culture?… No,” he told the New York Times.

However, it is clear that McCarthy is going to lead Peloton in a very different way to his predecessor Foley who refers to Peloton’s workforce as a “family”.

“You’ll never hear me say we’re a family”, noted McCarthy.

“We’re a sports team, and we’re trying to win the Super Bowl. And so we’re going to put the best players on the field we can.

“And if you go down the field, and we throw you the ball, and you drop it a bunch, we’re going to cut you.

“Because everybody else who’s trying hard to win the game deserves to have the best players on the field. And if you’re a good player, you’re going to love being on this team.”

McCarthy is very clear that this “cut and dry” approach also applies to him. “If we’re winning in the marketplace with my leadership, I think this is a nonissue. He’s a happy camper. He’s doing what he likes doing. And if the company isn’t doing well, I’m getting replaced anyway.”

It is going to be a challenging few months for Peloton’s leadership team as it navigates a difficult financial market, and its business model needs a rethink.

Only time will tell if McCarthy’s new approach to Peloton and its workers will drive success or if he will be replaced by someone else.