February 25, 2022: -The new CEO of Peloton told CNBC on Wednesday he’s examining the price of the company’s connected fitness products as part of an overall effort to increase its customer base and revenues.

Peloton’s Barry McCarthy comments came to his first TV interview since taking over as CEO and president this month at a critical juncture for the beleaguered company.

“I think there’s an enormous opportunity for us to flex the business model and dramatically increase the for new members by lowering the cost of entry and playing around with the relationship amid the monthly recurring revenue and the upfront revenue,” McCarthy said.

Peloton can improve the user experience of its Bike and Tread products to increase “consumer delight in ways that we haven’t yet imagined,” McCarthy said, which suggests that’s another way to grow the company’s universe of potential customers.

“So, no. I’m not focusing on increasing prices. I’m focused on doing the opposite and exploring the amount much price elasticity there is for the business,” said McCarthy, who stops at subscription-service innovators Spotify and Netflix are known as valuable to his role at Peloton.

In addition to the upfront cost of buying a Bike or Tread product, Peloton makes money through monthly subscriptions that give users access to its on-demand fitness classes. Investors place a higher value on recurring revenue streams such as subscriptions than they do revenues generated by selling physical products.

Peloton saw tremendous growth in the Covid pandemic but has seen demand for its exercise machines wane as people spend less time at home and return to gyms, leading to temporary production halts. Along with installing McCarthy as CEO, the company also laid off 20% of its corporate workforce to control costs.

The PelotonPeloton had a market capitalization of nearly $50 billion in January 2021, but it’s been dramatically reduced to $8.95 billion, based on a closing stock price of $27 per share on Wednesday.