A difficult task awaits the new chief financial officer at the former stock market star Peloton.
new York The New York fitness company Peloton announces the next change in management: Liz Coddington, the previous manager of Amazon’s profitable cloud division AWS, is to replace Jill Woodworth as chief financial officer. The manufacturer of interactive fitness bikes and treadmills has thus changed the CEO and CFO within four months.
Coddington’s job will not be easy, because the former stock market star is currently under extreme pressure: During the pandemic, Peloton had broken new records and could hardly keep up with the production due to the many requests.
The bikes with their training subscriptions had the appeal that you could train live at home with real trainers and other people. But as the pandemic eased and gyms reopened, demand plummeted. The supply chains are also causing problems for the company.
Peloton’s stock price today is less than a tenth of its peak during the pandemic. While the company was worth $50 billion in the stock market in early 2021, it’s now just $4 billion. Activist shareholders at Blackwells Capital have been pushing for a sale for months.
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Coddington should primarily help Peloton with her tech know-how. She previously worked not only at Amazon’s fast-growing cloud division AWS. She also brings experience from her stints at streaming service Netflix and retailer Walmart’s successful online division. As a result, she is familiar with subscription models as well as with logistics and online trading.
Working at Netflix with Peloton CEO McCarthy
“Liz is a highly talented finance executive and will be a valuable addition to the Peloton leadership team,” said CEO Barry McCarthy of her appointment. “Having worked at some of the strongest and most well-known technology brands, she not only brings the expertise to lead our finance organization. She also understands what it takes to achieve growth and operational excellence,” McCarthy says. He emphasizes that he has seen her work “firsthand”. Coddington worked at Netflix when McCarthy was chief financial officer.
The boom caused by the corona pandemic has long since evaporated.
(Photo: AP)
McCarthy only replaced co-founder and CEO John Foley in February. With his resignation, Foley gave in to pressure from investors, who were particularly worried about the financial situation. His successor McCarthy was previously CFO at the streaming specialists Netflix and Spotify and, like Coddington, has extensive experience with subscription providers. These are extremely important to Peloton’s steady cash flow. After all, customers don’t just pay up to $2500 for their standing bikes or treadmills. They also add subscriptions for $39 a month.
McCarthy is currently implementing a drastic restructuring course at Peloton. In the spring, the company announced that it would lay off 2,800 employees. That corresponded to a fifth of the workforce. An originally planned factory in the USA is also no longer being built. During his first investor conference on first-quarter earnings, McCarthy said he was amazed to see how messed up the supply chain is and how fast the cash is‧the company’s reserves are falling.
In May, Peloton signed an agreement with JP Morgan and Goldman Sachs that allows the company to borrow $750 million over five years to return to positive cash flow. So there’s plenty for Liz Coddington to do.
More: Peloton shocks shareholders with huge loss