Peloton Stock Falls After 800,000 Bikes Recalled Over Seat Issue

Core Viewpoint - Peloton's stock price fell by 6% following the announcement of a voluntary recall of approximately 833,000 exercise bikes due to a potential safety issue with the seat post that could lead to injuries or falls [1][2]. Product Recall Details - The recall affects the Peloton Original Series Bike+ model PL02, sold between December 2019 and July 2022, with impacted bikes having serial numbers starting with "T" [1]. - The Consumer Product Safety Commission indicated that the seat post issue poses "fall and injury hazards" [1]. Injury Reports - Peloton has received three reports of seat breakages, resulting in two reported injuries [2]. - The recall also includes about 44,800 bikes sold in Canada, although no breakage reports have been received from that market [2]. Company Background - Peloton went public in 2019 and experienced rapid growth during the COVID-19 pandemic, with revenues increasing from $915 million in 2019 to $1.82 billion in 2020, and reaching $4.02 billion in 2021 [3]. - However, revenue declined to $2.7 billion in 2024, and the stock price has significantly decreased from its peak of $162 per share in December 2020, with a 24% decline year-to-date as of Thursday [3]. Previous Recalls - This is the second significant recall for Peloton due to a similar seat post issue, with over 2.2 million bikes recalled in 2023 for related hazards [4]. - Prior to the 2023 recall, there were 35 reported instances of seat breakages, including 13 injuries such as fractured wrists and lacerations [4].