Latest News

Peloton Stock Drops After New CEO Pours Cold Water on Sale Speculation

0
Text size

A Peloton logo on a dumbbell at the company’s showroom in Dedham, Massachusetts.

Adam Glanzman/Bloomberg


Peloton Interactive

stock fell Monday after the exercise company’s new chief executive poured some cold water on speculation Peloton would pursue a sale.

The Financial Times also reported at least two new Peloton (ticker: PTON) workout machines are in development.

Barry McCarthy, the former


Spotify

(SPOT) and


Netflix

(NFLX) chief financial officer who was named Peloton’s chief executive last week, told the Financial Times in an interview published Monday that he planned to relocate to New York from California to focus on Peloton’s growth, not oversee a company sale.

“If I thought it was likely that the business was going to be acquired in the foreseeable future, I can’t imagine it would be a rational act to move across the country,” McCarthy told the Financial Times. “There are lots of other things I could be doing with my time that are quite lucrative than hanging out with a business that’s about to be sold.”

Peloton stock was down 6% to $32.58 on Monday.

Earlier this month, Peloton shares rallied as multiple outlets reported potential suitors for Peloton included


Amazon.com

(AMZN) and


Nike

(NKE). Last month, Jason Aintabi’s Blackwells Capital urged the company to fire then-CEO John Foley and explore a sale. Instead, McCarthy was named to succeed Foley, who was named executive chairman of the company’s board. Aintabi argued Foley isn’t “suited” for that role, on a board that, he contends, has too many Foley allies.

Peloton also announced 2,800 job cuts amid efforts to reduce costs after it failed to anticipate the drop in demand that it experienced as gyms reopened.

“To be unambiguously clear, I’m the chief executive officer,” McCarthy told the Financial Times. “The decisions land on my desk. And if there’s a disagreement between us about the path forward, I get the last vote.”

The Financial Times, citing two people familiar with the matter, reported that employees have been testing an interactive rowing machine that could launch before or at Peloton’s annual homecoming event on May 13. The report also mentioned a strength product with a less clear release timeline.

Peloton didn’t comment on the specifics of the FT’s report, but said in a statement to Barron’s that Peloton is a connected fitness company, not a bike company.

“We are continuously innovating across hardware, software, and content to improve the lives of our dedicated Member community,” the company said.

Write to Connor Smith at connor.smith@barrons.com

Can I Contribute to an HSA After I Retire?

Previous article

These 5 tech stocks — including small caps you probably don’t know — can lead the sector’s comeback

Next article

You may also like

Comments

Leave a reply

Your email address will not be published. Required fields are marked *

More in Latest News