Peloton CEO steps down, company to lay off 400 employees

TheStreet’s Conway Gittens brings you the biggest news of the day, including what investors are watching and Peloton’s continued slide.

Transcript

00:00 I'm Conway Giddens reporting from the New York Stock Exchange.

00:03 Here's what we're watching on the street today.

00:05 Stocks were in the green to close out today's session.

00:08 The Dow closed up over 300 points.

00:11 The Nasdaq rallied 1.5% and the S&P 500 closed nearly 1% higher.

00:16 This comes as investors continue to digest corporate earnings

00:20 while looking ahead to the all-important April jobs report due out on Friday.

00:24 Analysts are anticipating another strong month of job growth,

00:28 forecasting a gain of somewhere around 240,000 new jobs.

00:32 That is a slowdown from the 303,000 in March, but still good nonetheless.

00:37 Investors will be closely watching this report

00:39 to determine the health of the U.S. labor market.

00:42 In other news, Peloton is now searching for its third CEO in just over two years.

00:48 The company announced that current CEO Barry McCarthy will step down.

00:52 Fifteen percent of the company's workforce is heading out the door as well.

00:56 Peloton says the layoffs were necessary because it "simply had no other way

01:01 to bring its spending in line with its revenues."

01:04 The company released a statement saying "this restructuring will position Peloton

01:08 for sustained positive free cash flow while enabling the company to continue

01:12 to invest in software, hardware, and content innovation,

01:16 improvements to its member support experience,

01:18 and optimizations to marketing efforts to scale the business."

01:22 The restructuring plan comes on the heels of disappointing third-quarter results.

01:25 The fitness company missed Wall Street's expectations on both its top and bottom lines.

01:30 Peloton has suffered a dramatic fall from pandemic darling.

01:34 Revenues have declined for nine straight quarters.

01:37 It hasn't turned a net profit since December of 2020,

01:41 and the stock is at an all-time low.

01:43 Peloton doesn't seem optimistic going forward,

01:46 as it predicts a roughly 20 percent drop in app subscribers,

01:50 which comes out to about 150,000 users.

01:54 That'll do it for your daily briefing from the New York Stock Exchange.

01:57 I'm Conway Gittins with the Street.

01:59 Thanks for watching.

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