20,000 Peloton Members Cancel Subscriptions, , Cause Stock to Plunge.
In May of this year, Peloton announced that it was recalling 2 million bikes over a safety hazard imposed by the product's adjustable seat.
In May of this year, Peloton announced that it was recalling 2 million bikes over a safety hazard imposed by the product's adjustable seat.
As a result, 20,000 members paused their subscriptions until they received a replacement seat post, CNN reports.
.
The drop in subscription payments cost the company $40 million, according to its latest earnings report.
.
Early trading on Aug.
23 saw Peloton shares sink 20%.
According to Peloton, the amount of requests they received for new seat posts was "more than we expected.".
Only about half of the requests have been fulfilled so far.
The remainder will likely be completed "by the end of September," CNN reports.
.
According to Peloton, its latest earnings report is a "reminder we operate a seasonal business.".
The slowdown exceeded our expectations through May and through the first three weeks of June as consumer spending shifted toward travel and experiences, Barry McCarthy, Peloton CEO, via letter to investors .
Then eight weeks ago the trend reversed itself, and we began to see a reacceleration in hardware sales, Barry McCarthy, Peloton CEO, via letter to investors