The company that makes NordicTrack has lost its financial chief, even as the company’s search for a chief executive has stalled amid plunging demand for its exercise bikes and treadmills, The Post has learned.
Last month, Logan, Utah-based iFIT Health & Fitness saw the quiet departure of chief financial officer Steve Barr, according to sources close to the situation. Barr had also been awarded the title of co-president in February along with Mark Watterson, the son of the company’s charismatic, billionaire founder Scott Watterson.
Barr, who had been tapped in 2020 when iFIT was on a path to become a public company, declined to comment for this article.
Also on his way out is Tony Smith, iFIT’s chief development officer and a 28-year veteran of the company who is related to the Watterson family by marriage, according to sources. Smith, who is still listed as an executive on the company’s website, could not be reached for comment.
Meanwhile, iFIT’s search for a new CEO appears to have fizzled as it mounts a rampant round of cost-cutting, sources say. It’s the second bout of C-suite chaos in less than a year as iFIT — like its exercise-bike rival Peloton — grapples with hollowed-out appetites for home exercise gear as the pandemic has waned.
“The company is a shell of what it was,” said one source, who did not want to be identified. “Entire departments have been removed.”
The latest shakeup comes six months after the company’s investors forced out Scott Watterson as CEO, as The Post reported. Watterson’s autocratic management style had been seen as a liability to investors L Catterton and Pathlight Capital, which sunk $355 million into the company in March, sources said.
Nevertheless, Watterson remains chairman of the board, and a search that was initiated by the investors for his successor in March has yet to produce a candidate. One source suggested that a requirement by the Watterson family that the company remain headquartered in Logan, Utah, could limit the pool of candidates.
“That could be a problem in hiring a new CEO,” this source said.
IFIT, which is a privately held company, did not respond to multiple requests for comment.
IFIT and Peloton saw rampant growth during the pandemic when consumers were looking for alternatives to gyms. But as the pandemic began to wane both suffered huge losses after having expanded quickly to meet demand for home-exercise equipment that proved to be fleeting.
Over the past year both companies have been shedding jobs and more recently settled lawsuits against each other as they struggle to right-size their businesses.
Scott Watterson led the company for more than 40 years, handing out key leadership roles to family members including his four sons, as well as senior members of the Mormon Church. But he was bumped upstairs after fumbling the company’s expansion efforts during the pandemic, insiders told The Post.
Watterson also clashed with a lender Pamplona Capital Management earlier this year when he inked a deal to buy iFIT’s largest manufacturer in China, which Pamplona said violated its loan agreement. Pamplona sued iFIT for $300 million, but iFIT said in February the complaint was settled without disclosing details.
IFIT has had several rounds of layoffs this year, according to sources and social media posts, as has Peloton.
The latter booted its co-founder and former CEO, John Foley to the boardroom in February amidst a precipitous decline in demand for its high tech equipment along with allegations of mismanagement by Foley. IFIT and Peloton had also been locked in fierce litigation over trade secrets, but neither company could afford the litigation anymore and settled their lawsuits in May.
Earlier this month, Peloton’s new CEO, Barry McCarthy, told employees that nearly 800 jobs will be axed, that the company is raising its prices and shutting retail showrooms next year, according to a Bloomberg report. That was before it reported a massive $1.24 billion quarterly loss on Aug. 25.