Home exercise equipment maker Peloton said on Thursday it was recalling more than 2 million exercise bikes, sending its shares lower on the news.
The company’s shares tumbled more than 8% in midday trading, having plunged nearly 40% in the last month.
The company received 35 reports of seatposts breaking during use and falling off original models of its bikes, according to a recall notice From the Consumer Product Safety Commission.
Peloton is voluntarily recalling Model PL-01 bikes sold in the U.S. from January 2018 to May 2023 and is offering customers a replacement bike seatpost that can be installed at home, the company said in a statement statement on its website Thursday morning.
“It’s important for Peloton to actively engage with the CPSC to address this issue,” the company said. wrote“We worked with them to identify the remedy approved today.”
The decision to recall the bikes is a turnaround for Peloton, which has resisted recalling its equipment in the past. In 2021, the company recalled its Tread+ and Tread treadmills after it rejected warnings from safety boards that child deaths and dozens of injuries were linked to the equipment. Then-CEO John Foley said the company was wrong to reject a request to recall the treadmills.
In 2020, Peloton recalled pedals on about 27,000 bikes after receiving more than 100 reports of broken pedals and 16 reports of injuries.
Peloton has faced many other challenges in recent years. After being a pandemic winner in 2020, it has dealt with shaky revenues, negative TV portrayals and cooling consumer demand as people flocked to buy its home gym equipment.
Its current chief executive, Barry McCarthy, has been working to turn things around since succeeding company founder Mr Foley last year.Mr McCarthy lays off staff, emphasizes subscription strategy and start Equipment Resale Program.
In its most recent letter to shareholders, sent earlier this month, Mr McCarthy said the company had resolved a ITC Disputes It acquired Dish Network for $75 million, and its subscriptions grew 5% in the most recent quarter.
In that letter, he expressed cautious optimism, saying the latest quarter was the best since he took over as CEO. “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 past 12 months, we will achieve something truly special.”