Investing.com -- Peloton (NASDAQ:PTON) has named Peter Stern as its new CEO, ending a long-running search for a successor to former boss Barry McCarthy, as the connected fitness bike company looks to turn around its flagging subscription growth.
Stern previously served as President of Ford (NYSE:F) Integrated Services and before that held leadership roles at iPhone-maker Apple (NASDAQ:AAPL) and now-acquired cable television provider Time Warner Cable, Peloton said in a statement. He will take over the role from Jan. 1.
"Peter is a seasoned strategist with a track record of driving sustainable growth through innovation, and we have every confidence in his ability to lead Peloton during this important time," said Peloton Chairperson Jay Hoag. "He brings meaningful expertise in scaling differentiated technology-oriented platforms and has a deep understanding of the health and wellness sector[.]"
Peloton said it had conducted a "comprehensive search" for the firm's next leader. McCarthy, its former CEO, stepped down in May after Peloton delivered weak results despite his attempt to rebrand the business as an overall fitness company and attract customers who may not be able to pay for its pricier bikes and treadmills.
Analysts have since been asking for more clarity around New York-based Peloton's plans to revamp its operations, bring in subscribers, and rein in expenses. The firm is also moving to refinance its debt in order to buy it more time to carry out the overhaul.
In a separate release on Thursday, Peloton reported a 2.2% decline in first-quarter subscribers to its connected fitness offerings compared to the year-ago period to 2.9 million. Analysts had anticipated 2.92 million subscribers.
Paid digital subscribers, meanwhile, slipped by 24% year-on-year to 582,000, above estimates of 567,084.
Group-wide revenvue dropped by 1.6% to $586 million, but beat projections of $573 million. Meanwhile, roughly $15 million in savings within its 2025 fiscal year helped drive adjusted core income up sharply to $115.8 million -- well above Wall Street expectations.
Peloton's current-quarter revenue and profit guidance also outpaced consensus forecasts, while the company lifted its 2025 guidance for adjusted core earnings to a range of $240 million to $290 million. It had previously issued an outlook of $200 million to $250 million.
"As we approach the holiday season, we expect to increase media spend while maintaining discipline to ensure that the subscribers we acquire are profitable," Peloton said in a letter to shareholders.
Shares surged by more than 8% in premarket US trading.