- Blackwells Capital LLC is calling on Peloton to fire its CEO and explore options to sell the company.
- This is after a significant slump in Peloton stock, when shares plunged a whopping 24% on Thursday.
- The company has had a rough month, with price hikes, layoffs, and rumors of a halt in production.
Peloton investor Blackwells Capital LLC is pushing the company to fire its chief executive, James Foley, and look into options for selling the company, according to a report from The Wall Street Journal.
According to The WSJ, Blackwells still sees Peloton as a good product that could potentially be acquired by larger tech or fitness companies.
The WSJ cited sources, who said that Peloton has weakened significantly since its business boomed at the height of the COVID-19 pandemic. These sources also told The WSJ that Blackwells blames Foley, the company’s chairman, for the current business slump.
Blackwells has a stake of less than 5% in Peloton, per The WSJ.
This comes after Peloton’s shares slumped 24% on Thursday, following news reports that the company might be putting a pause on producing more stationary bikes due to a lack of sales.
Peloton has had a rough month, with news of price hikes and layoffs. It has grappled with multiple issues over the last year as well, per reporting from Insider’s Mary Hanbury. For one, the company had to recall products after US regulators issued warnings over its machines, after reports of a death and customers suffering injuries while using the company’s treadmills. Peloton also saw its growth slow significantly when its customers became more comfortable with the idea of going back to gyms. This pushed the company to cut the price of its entry-level bike by $400 in August.
In addition to these business-related troubles, Peloton also received a spot of bad PR when the “Sex and the City” reboot, “And Just Like That,” featured main character Carrie Bradshaw’s husband Mr. Big suffering a heart attack after a vigorous workout on his Peloton bike.
The company has also had to deal with the fallout from a leaked audio recording, in which execs appeared to discuss plans to lay off 41% of the company’s sales and marketing teams and slash headcounts in its e-commerce and retail divisions. According to a CNBC report, management consultancy firm McKinsey has been brought on board to handle Peloton’s job cuts.
Courtesy By INSIDER