Business

Peloton lured CEO Barry McCarthy with $168M pay package

Money-losing train bike maker Peloton dangled a $168 million compensation package to coax Barry McCarthy out of retirement and into the recent seat as its CEO, a proxy submitting exhibits.

The eye-popping payout is 2,299 instances better than the median $73,117 wage at Peloton, in keeping with Tuesday’s submitting.

The payout would make McCarthy one of many highest-paid chief executives within the US, however the overwhelming majority of his compensation is tied to Peloton’s stock efficiency.

Peloton’s shares, as soon as north of $150 through the top of the pandemic, traded Wednesday beneath $8. The stock must rise to $38.77 earlier than he can train the choices on his 8 million shares.

McCarthy was given an annual wage of $357,692, however it was elevated to $1 million in June, in keeping with the submitting.

The former finance govt at Netflix and Spotify took over the company in February after the ouster of Peloton’s founder John Foley.

John Foley
John Foley stepped down as CEO of Peloton in February.
Bloomberg by way of Getty Images

Foley, who was compelled out as CEO after buyers accused him of mismanagement and stepped down from the board final month, cashed out stock value $97 million within the 12 months ending in June 2022, the submitting confirmed.

His spouse, Jill, was additionally on the payroll because the company’ vp of boutique and attire, knocking down a wage of $334,750 and $457,688 in fairness compensation in fiscal 2022, in keeping with the submitting. In addition, she acquired $334,750 in severance.

Nonetheless, Foley’s fortune sank as Peloton’s worth collapsed from roughly $50 billion to lower than $8 billion. The couple have put their ocean-front Hampton’s mansion on the block and likewise bought a smaller house within the Hamptons.

A Peloton stationary bike
Peloton gross sales have fallen dramatically for the reason that top of the pandemic when demand for at house train gear soared.
Bloomberg by way of Getty Images

The company’s monetary peril has endured regardless of Foley’s departure, falling to a valuation of simply $2.5 billion.

McCarthy instituted a collection of layoffs after taking up, together with eliminating 500 jobs, or 12% of its workforce, just some weeks in the past.

“The bulk of our restructuring work is complete,” McCarthy mentioned earlier this month. “We are eliminating these positions and reducing other operating expenses, in order to reach break-even cash flow by year-end FY23.”

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