It seems the recently announced CEO transition at Peloton Interactive Inc (NASDAQ:PTON) is off to a bumpy start. According to a CNBC report, an introductory meeting for the new CEO was crashed by former Peloton employees.
What Happened: Barry McCarthy, who formerly held senior leadership positions at Netflix Inc (NASDAQ:NFLX) and Spotify Technology SA (NYSE:SPOT), was appointed CEO and president of Peloton, effective Feb. 9. Peloton co-Founder and outgoing CEO John Foley will transition to a new role as executive chair.
In an email sent to Peloton employees following the announcement, McCarthy outlined his plans to turn the connected fitness company around.
"And now that the reset button has been pushed, the challenge ahead of us is this ... do we squander the opportunity in front of us or do we engineer the great comeback story of the post-COVID era?,” McCarthy reportedly said in the email.
See Also: Why This Peloton Analyst Thinks John Foley's Exit Increases The Possibility Of A Sale
Peloton is focusing on cutting costs across its business. The company trimmed about 20% of its workforce, or 2,800 jobs.
Why It Matters: Some of those employees were still hanging around when Peloton held a virtual all-hands meeting Wednesday with the intent of introducing its new CEO.
The meeting was cut short when former and current employees began chatting about mismanagement claims and the recent job cuts, according to the report, citing three people familiar with the details of the meeting.
CNBC was able to obtain comments from the virtual meeting. "I’m selling all my Peloton apparel to pay my bills!!!," one person said.
"This is awfully tone deaf," another commented.
"The company messed up by allowing people who were fired into this chat,” someone else said. "Too late to mod this."
The report notes that there was also positive commentary from workers welcoming the new CEO to the company.
The results of McCarthy's first meeting suggest the new CEO may need to focus on improving employee morale before taking on some of the other challenges Peloton is facing.
"We have to be willing to confront the world as it is, not as we want it to be if we’re going to be successful," McCarthy said in the email to employees.
Peloton reportedly offered outgoing workers cash severance, career services and a monthly Peloton membership for 12 months.
PTON Price Action: Peloton has traded as low as $22.81 and as high as $155.52 over a 52-week period.
The stock was down 2.48% at $37.81 Thursday afternoon.
Photo: courtesy of Peloton.
