Investors bailed out of Peloton shares after the company announced the voluntary recall of its Tread+ and treadmill products following the accidental death of a child.
The stock lost 14.5% in Wednesday's session which pulled its market value down by $4 billion to $24.3 billion, as tracked by Dow Jones Market Data Group. The interactive media company is set to report earnings after the close of trading on Thursday.
The interactive exercise company, along with the U.S. Consumer Product Safety Commission (USCPS), warned against using the company's Tread+ machine following reports of the child's death and multiple injuries.
CEO John Foley, who had previously pushed back against the USCPS in its safety concerns over the product, issued a mea culpa.
"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+," Foley said. "We should have engaged more productively with them from the outset. For that, I apologize."
The recalls of around 125,000 units cover the $4,295 Tread+ and the $2,495 Tread treadmills.
As for quarterly performance, analysts are expecting the company to post a loss of $0.11 compared with a $0.20 loss during the same period a year ago. Revenue is expected to jump to $1.1 billion, a marked improvement from the prior year.