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Peloton’s original bike model has a potential safety issue with some seat posts that the fitness and media company wants to address.
The issue has caused certain seatposts to suffer a break while their owners use them, Peloton said in a filing with the Securities and Exchange Commission Thursday. The Peloton Bike+ is not affected.
Peloton said it has “determined that a corrective action plan is warranted” for the potential third-quarter seatpost issue.
A Peloton exercise bike is seen after the opening bell for the company’s initial public offering at the Nasdaq Market location in New York City on September 26, 2019. Portal/Shannon Stapleton/File Photo/File Photo (Portal photos)
According to the filing, there were nearly three dozen cases of seatpost fractures, 12 of which involved injuries. One person broke his wrist in an incident.
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The company noted in the filing that the 35 reports were “from over 2.4 million units sold in the U.S. and Canada.”
The Consumer Product Safety Commission was voluntarily informed, Peloton said. The corrective action plan fix, developed in collaboration with the CPSC, would be shared with customers, according to the filing.
Jen Van Santvoord rides her Peloton exercise bike at her home in San Anselmo, California on April 07, 2020. (Photo by Ezra Shaw/Getty Images) ((Photo by Ezra Shaw/Getty Images)/Getty Images)
Peloton reported that the corrective action plan for the issue resulted in an “estimated contingent loss expense” of $8.4 million during the quarter. The expenses “were not material to the financial performance of the current period,” the company said in the filing.
Peloton has previously interacted with the CPSC. Earlier this year, the CPSC announced an agreement with Peloton that included a $19 million penalty after the company allegedly “failed to immediately report” dangerous defects in its treadmill product, Tread+, to the agency.
PELOTON SPENT $19 MILLION TO NOT REPORT SAFETY ISSUES ON THE TREADMILL
According to a recall notice on the CPSC website, a 2020 recall was conducted related to an issue with the clip-in bicycle pedal.
In the third-quarter filing, which included the seatpost issue, Peloton said revenue was $748.9 million, down 22% from the third quarter of 2022, when it was $964.3 million -dollar fraud. The net loss shrank to $275.9 million.
Peloton’s shares are down about 90% over the past year. (main field)
Peloton stock, which was around $7.9 as of Friday afternoon, is up almost 3% in price since the start of the day. It has fallen by over 54% over the past year.
| ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| PTON | PELOTON INTERACTIVE INC. | 7.81 | +0.17 | +2.23% |
Barry McCarthy has served as the company’s CEO since February 2022, when co-founder John Foley left the position.
PELOTON CO-FOUNDERS JOHN FOLEY, HISAO KUSHI RESIGN DURING LEADERSHIP CHANGE
FOX Business reached out to Peloton for more comments on the seatposts.
Phillip Nieto contributed to this report.