(Reuters) -Peloton Interactive Inc said on Tuesday it would replace its chief executive officer, cut jobs and appoint new board members as the company wrestles with waning demand for its at-home fitness equipment.
The exercise bike maker's co-founder, John Foley, will step down as CEO and will become the executive chair, the company said.
Barry McCarthy, the former chief financial officer of Spotify Technology SA and Netflix Inc (NASDAQ:NFLX), will take the helm from Wednesday.
Foley attracted the ire of activist investor Blackwells Capital as the company has struggled to maintain the breakneck growth that helped its valuation swell to $52 billion in early 2021.
The investment firm called for his removal and even urged the company to sell itself, blaming the stock's underperformance to "gross mismanagement", Foley's poor decision making and lack of credibility.
Analysts have, however, said the company's dual-share class structure may be a deterrent to takeover approaches.
Last week, Reuters reported that Peloton has drawn interest from potential buyers including e-commerce giant Amazon.com Inc (NASDAQ:AMZN), citing a person familiar with the matter.
Shares of the company were down 9% in premarket trading on Tuesday. They had gained about 21% on Monday following reports of the buyout interest.
Peloton's sales boomed during COVID-19 lockdowns, with many snapping up home fitness equipment. But fortunes began to fade as vaccinations increased, gyms reopened and rivals offered competitive products.
In November, the company hinted that demand for its exercise bikes and treadmills was slowing faster than expected, and its market capitalization since then has shrunk to about $9 billion.
Peloton will also cut roughly 2,800 jobs, affecting 20% of its corporate positions, the company said.
Last month, Blackwells urged the company's board to fire Foley and put itself up for sale to a buyer like Walt Disney (NYSE:DIS) Co, Apple Inc (NASDAQ:AAPL), Sony Group or Nike Inc (NYSE:NKE).