In a major reversal, Peloton announced Wednesday voluntary recalls of both its Tread+ and Tread treadmill machines over safety concerns.
Its shares tanked more than 8% on the news.
The company is advising customers who already have the products to immediately stop using it and contact Peloton for a full refund, or other qualified remedy.
The U.S. Consumer Product Safety Commission had previously warned about Peloton’s Tread+ product last month, after one child died in an incident involving the machine and there were dozens of other reported injuries.
But Peloton pushed back on the recommended recall at the time, and told customers there was no reason to stop using its treadmills.
“I want to be clear, Peloton made a mistake in our initial response to the Consumer Product Safety Commission’s request that we recall the Tread+,” CEO John Foley said in a statement Wednesday. “We should have engaged more productively with them from the outset. For that, I apologize.”
Peloton also said it will work with the CPSC to set new industry safety standards for treadmills.
Peloton shares tumbled more than 7% on the news.
The company is advising customers who already have either the Tread or Tread+ products to immediately stop using the equipment and contact Peloton for a full refund or other qualified remedy. It added it is working on a repair to be offered to treadmill owners in the coming weeks.
The CPSC had previously warned about Peloton’s Tread+ product last month, after one child died in an incident involving the machine and there were dozens of other reported injuries.
The agency said Peloton’s treadmills are designed differently than its peers, with “an unusual belt design that uses individual rigid rubberized slats or treads that are interlocked and ride on a rail.” That’s instead of a thinner, continuous belt. There is also a large gap between the floor and the belt of the Tread+, leaving room for things to wiggle their way under.
The commission simultaneously in April released a graphic video, captured by a home security camera, of a young boy being pulled under one of the Tread+ machines and struggling to free himself.
But Peloton pushed back on the recommended recall at the time, and told customers there was no reason to stop using its treadmills, so long as children and pets were kept out of the area while in use. The company had also recommended a key be used to lock the device after each workout.
Peloton said Wednesday that it will work with the CPSC to set new industry safety standards for treadmills.
Peloton, known for its at-home cycling classes that have exploded in popularity during the Covid pandemic, didn’t sell a treadmill until 2018.
The product was first called the Tread but is now known as the Tread+ because Peloton was preparing to begin selling a less expensive version in the United States later this year. The original model costs $4,300.
The smaller, cheaper version is already on sale in the U.K. and it doesn’t include the same rigid slats as the Tread+.
A spokesperson didn’t immediately respond to CNBC’s request for comment about Peloton’s plans for the upcoming launch.
While Peloton doesn’t break out sales of its treadmills, Cowen & Co. had previously estimated that the Tread+ would represent about 2.2% of unit sales in 2021. That’s out of about 1.63 million stationary bikes and treadmills combined, it said.
In 2020, Peloton reported $1.8 billion in revenue, up from $915 million a year earlier.
Peloton is set to report earnings after the market close on Thursday.
This story originally appeared on CNBC.com.