The CEO of Peloton, Barry McCarthy, extends a lucrative job offer amounting to $168 million.
Peloton's newly appointed CEO, Barry McCarthy, stands to receive a total compensation package worth $168 million this year, according to the company's latest filing. The majority of this sum comes from McCarthy's new hire equity grant.
The report reveals that McCarthy's base salary is aligned with his predecessorJohn Foley's at $1 million. However, given that he joined in February, his prorated base salary for the fiscal year 2022 amounts to $357,692. Additionally, he is entitled to $167 million in stock options.
To realize the profit from his stock options, McCarthy would need to purchase approximately 8 million shares at a price of $38.77 and then sell them. At the time of publishing, Peloton's share price stands at $7.70.
The compensation package for McCarthy equates to around 2,299 times the median employee's salary as per the filing. For contrast, Walmart CEO Doug McMillon's total compensation for 2022 amounts to around $25 million, while Target's CEO Brian Cornell received a total compensation of over $19.7 million in 2021.
Peloton's former CEO and co-founder John Foley and Hisao Kushi departed the company last month. Following their exit, the head of marketing and Chief Commercial Officer also left the company.
In a move to expand its sales, Peloton has recently initiated partnerships to sell its products on Amazon and at Dick's Sporting Goods. The brand has also chosen to downsize its workforce by some 500 employees, or about 12%, and reported a loss of approximately $100 million on retail last year.
It is worth noting that Peloton's CEO-to-median-employee pay ratio has historically been high, reflecting its status as a tech-driven consumer products company with executive compensation significantly higher than median worker pay. Other retail giants like Walmart report even higher ratios, while Target's ratio typically falls between Walmart's and tech companies like Peloton.
Hence, Peloton's new CEO Barry McCarthy steps into a challenging role, tasked with steering the company through its current difficulties and leading it to growth and profitability.
Barry McCarthy's compensation package, worth $168 million, includes not only his base salary of $1 million, but also significant stock options valued at $167 million. This package, mainly stemming from his new hire equity grant and stock options, underscores the interplay between technology, finance, business, and AI in determining executive remuneration in the modern world.
