You might be right that it's a tough business. But maybe McCarthy just wasn't the right guy? It was his first CEO job--which IS a lot bigger than a CFO--and he came in with no experience in physical products. He also might have tried to copy and paste lessons from his previous subscription businesses--i.e. fighting the last war, a common mistake of previously successful leaders.
I love my Peloton bike and use the app frequently for yoga. A good number of us think it's an outstanding product, with weak competition. Seems like there's a business model that would work!
Good points! Maybe i'm underestimating how big a change it is to go from CFO to CEO.
And also this seems like they were damned by the pandemic bubble -- it seems very hard to recover from having been hugely overvalued, regardless of what business you're in.
It seems like it'd be a good acquisition target for Apple if regulators would allow that, because it does seem like a great product
You may be right that it’s the market not the man. However PTON missed estimated EPS four straight quarters (which I assume was his guidance) and was still burning cash. Just two consecutive earnings misses is enough to fire the CEO in some cases.
An earnings miss could come from multiple sources. There might be information in the financials or in management’s discussion during the earnings calls. I would bet it wasn’t SGA. You can control that from the top down. Probably weaker-than-expected sales due to post-pandemic consumer behavior and preferences not bouncing back as fast as they hoped.
You might be right that it's a tough business. But maybe McCarthy just wasn't the right guy? It was his first CEO job--which IS a lot bigger than a CFO--and he came in with no experience in physical products. He also might have tried to copy and paste lessons from his previous subscription businesses--i.e. fighting the last war, a common mistake of previously successful leaders.
I love my Peloton bike and use the app frequently for yoga. A good number of us think it's an outstanding product, with weak competition. Seems like there's a business model that would work!
Good points! Maybe i'm underestimating how big a change it is to go from CFO to CEO.
And also this seems like they were damned by the pandemic bubble -- it seems very hard to recover from having been hugely overvalued, regardless of what business you're in.
It seems like it'd be a good acquisition target for Apple if regulators would allow that, because it does seem like a great product
You may be right that it’s the market not the man. However PTON missed estimated EPS four straight quarters (which I assume was his guidance) and was still burning cash. Just two consecutive earnings misses is enough to fire the CEO in some cases.
Fair point. What do you think causes earnings misses? The team not being in sync and underperforming? Or management being too optimistic?
His reputation is that he is very direct and no BS so it felt like if someone was going to go in and see things clearly it would be him
An earnings miss could come from multiple sources. There might be information in the financials or in management’s discussion during the earnings calls. I would bet it wasn’t SGA. You can control that from the top down. Probably weaker-than-expected sales due to post-pandemic consumer behavior and preferences not bouncing back as fast as they hoped.