Peloton’s new CEO, Barry McCarthy, says he’s ‘here for the comeback story,’ an internal email shows

Peloton‘s new CEO, Barry McCarthy, is telling remaining staff that he’s “here for the comeback story.”

In an email sent to Peloton employees late Tuesday, following the announcement that the former Netflix and Spotify exec would be replacing Peloton founder John Foley as chief executive, McCarthy laid the groundwork for his plans to turn around the embattled connected fitness company.

“We have to be willing to confront the world as it is, not as we want it to be if we’re going to be successful,” he wrote in the memo, which was obtained by CNBC.

He goes on to say, “If you thought today’s news meant John [Foley] would be scaling back his involvement with Peloton, then let me assure you … I plan on leveraging every ounce of John’s superpowers as a product, content, and marketing visionary to help make Peloton a success as my partner.”

Foley, a former Barnes & Noble exec who launched Peloton in 2012, has transitioned to executive chairman as part of the management shakeup.

“And now that the reset button has been pushed, the challenge ahead of us is this … do we squander the opportunity in front of us or do we engineer the great comeback story of the post-Covid era?,” McCarthy writes.

McCarthy’s comments cast even more doubt on the idea that Peloton would be open to a takeover from a company like Amazon or Nike. In recent days, reports have circulated that certain parties were interested in the business amid the stock’s selloff. Activist Blackwells Capital is also pushing Peloton to consider a sale.

A Peloton spokesperson didn’t respond to CNBC’s request for additional comment.

Analysts say they are optimistic about what McCarthy can do at Peloton, given his experience working with founders and helping lead companies with massive membership-based businesses.

“He brings a wealth of experience in growing subscription businesses and should be able to execute on the restructuring plan, instill financial discipline and help scale the business,” said Telsey Advisory Group CEO Dana Telsey.

KeyBanc Capital Markets analyst Ed Yruma called McCarthy “uniquely positioned” to take the reins.

“We have long believed that the content business is both the competitive moat and most valuable element of the Peloton story,” he wrote in a note to clients.

To be sure, McCarthy has a tough path ahead to get Peloton back to profitability. User growth has slowed in recent quarters, and Peloton is positioned in an increasingly crowded market for connected fitness equipment. He must also compete with gyms, which are winning back customers who are eager to get out of the house.

Peloton shares were down about 1% in premarket trading Wednesday, having closed Tuesday up 25%, at $37.27.

Read the full email below that Peloton CEO Barry McCarthy sent to staff.