Peloton, a maker of home exercise equipment, said on Thursday it was recalling more than two million exercise bikes, an announcement that sent its shares tumbling.
The company’s shares were down nearly 9 percent at the close of the market and are down more than 20 percent this month.
The company has received 35 reports of seatposts breaking and coming loose from its original model bike during use, according to a Consumer Product Safety Commission recall notice.
Peloton is voluntarily recalling PL-01 model bikes that were sold from January 2018 to May 2023 in the United States and is offering customers replacements for the bike’s seatposts that can be installed at home, the company said in a statement. on its website on Thursday. morning.
“It was important to Peloton to proactively engage the CPSC to resolve this issue,” the company wrote. “We worked cooperatively with them to identify the drug approved today.”
The decision to recall the bikes is a about-face for Peloton, which in the past has resisted recalling its equipment. In 2021, the company recalled its Tread+ and Tread treadmills after initially resisting a safety commission warning that the death of a child and dozens of injuries were related to the equipment. John Foley, the chief executive at the time, said the company made a mistake in challenging the recall request for the treadmills.
In 2020, Peloton recalled pedals on nearly 27,000 bikes after receiving more than 100 reports of breakage and 16 reports of injuries.
Peloton has faced a number of other challenges in recent years. After emerging as a pandemic winner in 2020, when people bought her home exercise equipment in droves, she has grappled with difficult revenues, negative representations on television and cooling consumer demand.
Its current chief executive, Barry McCarthy, has been trying to turn around since taking over, last year, Foley, one of the company’s founders. McCarthy cut jobs, emphasized a subscription strategy, and started an equipment resale program.
In his most recent letter to shareholders, sent earlier this month, McCarthy said the company had settled an International Trade Commission dispute with Dish Network for $75 million, and that its subscriptions were up 5% in the last quarter.
In that letter, he struck a cautiously optimistic note, saying the most recent quarter was the best since he took over as chief executive. “There will be challenges and opportunities ahead,” he wrote, “but if we continue to perform in the next 12 months as we have in the last 12, we will have accomplished something truly special.”
