Peloton said on Thursday that its CEO, Barry McCarthy, was stepping down and it would lay off more workers, as it continued to struggle in the fitness market.

The connected-fitness company announced disappointing quarterly earnings Thursday, with revenue down 4% from last year. The company, which has not turned a profit since December 2020, is also looking to refinance more than $1 billion in debt.

Peloton had a spectacular rise at the start of the pandemic, when gyms and fitness centers closed and consumers were hungry for at-home workout options. But after gyms reopened, Peloton began to face stiffer competition from companies such as Bowflex and Lululemon.

It is reducing its head count by 15%, or 400 workers, in an effort to cut its costs by $200 million by June 2025. Peloton has had several other rounds of job cuts in the past couple of years, most recently in October 2022, when it laid off about 12% of employees, or about 500 people.

“Hard as the decision has been to make additional head count cuts, Peloton simply had no other way to bring its spending in line with its revenue,” McCarthy said in a statement.

Investors appeared optimistic about the news; Peloton’s stock price rose about 9% in premarket trading.

The company said it was looking to reduce its retail footprint and instead invest in “software, hardware and content portfolio and in improvements” for paying subscribers.

McCarthy, a former Spotify and Netflix executive, joined Peloton in February 2022, taking over from the company’s founder, John Foley. Two board members, Karen Boone and Chris Bruzzo, will serve as interim co-chief executives.

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