A close-up view shows the running deck of a Peloton Tread treadmill during CES 2018 at the Las Vegas Convention Center on January 11, 2018 in Las Vegas, Nevada.
Ethan Miller | Getty Images
Peloton said Friday that the U.S. Department of Justice and the Department of Homeland Security have cited the fitness equipment maker for documents and other information related to injuries reported by Peloton customers.
In May, Peloton issued a widespread recall for its two treadmill machines, the Tread and Tread +, after a child was killed in an accident and dozens of other users reported injuries.
For weeks, however, Peloton refused to recall the machines, despite requests from regulators and politicians. The Consumer Product Safety Commission, a watchdog group, warned against using the Tread + product in mid-April.
In a filing with the Securities and Exchange Commission on Friday, Peloton said it is also being investigated by the SEC over its public disclosures related to these violations. The company also said it was named in multiple court cases related to the recalls.
A spokesman did not immediately respond to CNBC’s request for additional comments.
Peloton shares fell more than 9% in early Friday trading after disappointing fourth-quarter financial results.
Peloton said it intends to work together on each of the investigations. “At this time, we cannot predict the possible scope, duration or outcome of the investigations,” added the company.
On Thursday, Peloton said it was cutting the price of its original bike for the second time, cutting the cost by about 20% to $ 1,495. In this way, the company hopes to reach new customers who previously could not afford its cycles.
Peloton shares are down about 25% year-to-date, bringing the company’s market cap to $ 34 billion.
Find Peloton’s full SEC filing here.
Comments are closed.