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Peloton Treadmill Death Is Focus of Consumer Agency Inquiry

The U.S. Consumer Product Safety Commission says it is investigating an accident tied to the Peloton treadmill in which a child died.
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A federal watchdog agency said it was investigating an accident involving Peloton Interactive's PTON newly released treadmill, the Tread+, that resulted in the death of a young child.

"We are aware of the incident and are investigating it," the U.S. Consumer Product Safety Commission said in a statement.

Peloton CEO John Foley said in a post on the website of the New York connected-fitness company that the accident involved a Peloton Tread+, which was released last spring.

"While we are aware of only a small handful of incidents involving the Tread+ where children have been hurt, each one is devastating to all of us at Peloton, and our hearts go out to the families involved," Foley said.

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Bloomberg reported a second accident involving a child and the Tread+ that occurred last month.

A report filed in February with the CPSC said a 3-year-old boy sustained “significant brain injury” after getting trapped under the equipment

After being discovered by his father, the child “was found to have tread marks on his back matching the slats of the treadmill, neck injury, and petechiae on his face, presumably from occlusion of blood flow,” according to the report.

On March 17, the report was updated with a note from Peloton, saying that the company had been told by a member that the child was “expected to fully recover.”

In October 2020, a 42-year-old man reported a pedal on a Peloton Bike snapped off during use, but the person didn’t seek first aid. Peloton issued a voluntary recall on that part, according to another CPSC report.

Peloton said in an email that it had made the CPSC "aware of these incidents and will work with the CPSC to address any questions or concerns."

The safety commission said that in 2019 an estimated 22,500 treadmill-related injuries among people of all ages were treated at U.S. emergency departments. Of those injured, around 2,000 were children under 8 years of age.

Between 2018 and 2020, 17 fatalities associated with the use of treadmills have been reported to CPSC. This includes all ages, the agency said, adding that one of the 17 victims was a 5-year-old child.

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Bank of America analyst Justin Post said that Peloton was down Thursday, possibly due to the accident.

The analyst said he expected additional safety measures from Peloton.

Looking past the incident, he says that improving Bike+ and Tread+ delivery times are likely next on the agenda.

Post, who maintains a buy rating and a $175 price target on the shares, said that Peloton is a "stay-at-home" beneficiary that is subject to slowing growth as economies reopen.

But he expects a strong launch for the Tread this summer and sees a robust product pipeline that should help Peloton grow through more difficult comparisons in fiscal 2022.

Peloton saw demand for its products and services surge as the coronavirus pandemic shutdown kept fitness buffs and athletes stuck at home.

Last month, the company reported fiscal-second-quarter results that topped analyst estimates.

Separately, Peloton said it entered an agreement to its amended credit pact, adding Citibank as a lender and increasing the credit available to the company under the revolving facility by $35 million to $285 million, according to its SEC filing.

Shares of the company at last check were 5.2% higher at $108.03.