Employees dined on seafood and sipped champagne in the glittering halls of Hudson Yards on the night of September 26, 2019. Hours after Peloton’s meteoric rise shares went public, as they discussed how they planned to spend their newfound paper fortunes.
Some talked about the new car they’d buy, the second home they’d always wanted. And the student loans they’d finally be able to pay off at a lavish party in the company’s soon-to-be New York City headquarters.
“It felt like nothing could stop it,” said a former engineer who attended the party. It was the start of what former employees called Peloton’s “opulence” era. A brief period fueled by blind optimism and hubris. That propelled the company’s stock to dizzying heights only to see it plummet a little more than two years later.
Peloton’s stock has plummeted from a high intraday share price of $167 in December 2020 to $13.60 today. That represents roughly half its initial share price of $27 after the IPO was priced at $29. Its market capitalization has dropped from over $45 billion to around $4.7 billion.
However, shares are up about 71% so far this year.
The company has been gut by falling sales, a shift in consumer demand, and a scandal involving the Tread+. Which result in a costly recall after a six-year-old died also dozens of others were injure.
The escalating issues forced co-founder also CEO John Foley to resign over a year ago. Barry McCarthy, a former Spotify also Netflix executive who instituted an aggressive turnaround strategy and a new era of fiscal prudence, succeeded him.
McCarthy has brought the company back from the brink of extinction by increasing its free cash flow levels from negative $747 million to negative $94 million as of the end of its most recent fiscal quarter.