Peloton plans to replace CEO, overhaul board

© Reuters. FILE PHOTO: A stationary bicycle inside of a Peloton store is pictured in the Manhattan borough of New York City, U.S., January 25, 2022. REUTERS/Carlo Allegri/File Photo

(Reuters) -Peloton Interactive Inc plans to replace its chief executive officer, cut costs and overhaul its board, the Wall Street Journal reported on Tuesday, as the exercise bike maker looks to cope with waning demand that has slammed its shares.

Co-founder John Foley will step down as CEO and will become the executive chair, while Barry McCarthy, the former chief financial officer of Spotify Technology SA (NYSE:SPOT) and Netflix Inc (NASDAQ:NFLX), will become the new boss, the report added.

The company has drawn interest from potential buyers including e-commerce giant Amazon.com Inc (NASDAQ:AMZN), according to a person familiar with the matter.

Peloton (NASDAQ:PTON) will also cut roughly 2,800 jobs, affecting 20% of its corporate position, the newspaper https://on.wsj.com/3HDHLtP reported. The job cuts will not affect its fitness instructor roster or content, the report said.

The company's sales boomed during COVID-19 lockdowns, with many snapping up home fitness equipment. But fortunes began to fade as vaccinations increased, gyms reopened and rivals offered competitive products.

Peloton's stock price has slumped 83% in the last year and it is now valued at roughly $9.7 billion, compared with $50 billion at the peak of its popularity.

Last month, investment firm Blackwells Capital urged the company's board to fire its chief executive officer and put the company up for sale.

The investment firm, run by Jason Aintabi, has also urged the board to put the company up for sale to a buyer like Walt Disney (NYSE:DIS) Co, Apple Inc (NASDAQ:AAPL), Sony (NYSE:SONY) Group or Nike Inc (NYSE:NKE).

Peloton did not immediately respond to a Reuters request for comment.

Shares of the company were down 3.2% in premarket trading.

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