Peloton is recalling its treadmills — Tread and Tread+ — as a result of mounting pressure following dozens of injuries and the death of a 6-year-old.
News of the recall sent Peloton’s stock tumbling below $83 on Wednesday, an eight-month low. The stock had already dropped 22% from early April to market close on Tuesday.
The connected fitness company is offering refunds for over 130,000 Tread+ machines ($4,295), and another 1,050 Treads ($2,495).
Peloton is rolling out software updates to prevent machines from being turned on involuntarily and offering to move treadmills to a room inaccessible to children and pets in lieu of a recall.
With a recent $100 million investment to scale up logistics and a growing number of challengers on the market, Peloton can ill afford a hit to its brand.
- A slew of competitors have received funding this year: Tonal ($250 million), Tempo ($220 million), Ergatta ($30 million), Hydrow ($25 million), Motosumo ($6 million), and LIT Method (undisclosed).
- The company is also dealing with revelations that all of its customer data is available to any member through a leak in its software API.
Peloton CEO John Foley apologized for initially brushing off warnings from the Consumer Product Safety Commission.