Peloton’s stock price stumbled 6% on Thursday shortly after the company announced it would voluntarily recall some 833,000 exercise bikes due to an issue that could cause seats to break during use.
Key Takeaways
- The recall applies to Peloton Original Series Bike+ model PL02 sold between December 2019 and July 2022, according to the company, and impacted bikes will have a serial number beginning with the letter “T.”
- These bikes come equipped with a seat post that can break while being ridden, causing “fall and injury hazards,” according to the Consumer Product Safety Commission.
- Peloton has received three reports of seats breaking, leading to two injuries.
- The recall also applies to about 44,800 bikes sold in Canada, Peloton said, but the company has so far received no reports of seats breaking in that country.
Key Background
Peloton, which went public with an IPO in 2019, grew rapidly during the COVID-19 pandemic as customers when gyms were forced to close or operate at a limited capacity. The company reported revenue of $915 million in 2019, which then doubled to $1.82 billion in 2020. The company kept growing through 2021, reporting $4.02 billion in revenue before sales began to decline the next year. Revenue in 2024 dropped to $2.7 billion. Peloton’s stock price reached record highs of $162 per share in December 2020, but has declined significantly over the last few years. Its stock was still down 24% year-to-date on Thursday.
Tangent
This is the second time Peloton has recalled a large number of bikes due to a similar seat post issue. In 2023, the company recalled over 2.2 million bikes of an earlier model over an issue that caused similar hazards. Customers reported 35 instances of seats breaking before the recall, including 13 reports of injuries including “fractured wrist, lacerations and bruises,” according to the Consumer Product Safety Commission.
Look back on the week that was with hand-picked articles from Australia and around the world. Sign up to the Forbes Australia newsletter here or become a member here.
This story was originally published on forbes.com and all figures are in USD.
