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How Peloton's treadmill recall may impact future demand, consumer trust
Peloton issuing recall on treadmills may impact demand: BMO managing director
BMO Capital Markets managing director Simeon Siegel discusses the impact of Peloton’s treadmill recall.
Peloton investors are nursing their wounds after the company voluntarily recalled both of its treadmill products after the death of a child several weeks ago. The shares hit the lowest levels since September.
Later today, the company will give a fresh update in its third-quarter earnings after the closing bell, however, consumer and investor trust may be damaged after the company's delay on the issue.
"This probably should have been the reaction three weeks ago. So much of what Peloton has engendered is a sense of community, is a sense of trust," BMO Capital Markets director Simeon Siegel told FOX Business Thursday.
PELOTON INTERACTIVE, INC.
The connected fitness company on Thursday recalled both its treadmill products, around 125,000 units, nearly three weeks after the Consumer Product Safety Commission urged consumers to stop using the equipment following the death of one child and more than 70 other reported incidents. Chief executive officer John Foley apologizing for not complying with the watchdog agency's request sooner. Peloton’s stock lost 14.5%, pulling its market value down by $4 billion to $24.3 billion, as tracked by Dow Jones Market Data Group, after the company’s recall.