Shares of Peloton Interactive (PTON 4.89%) surged higher on Tuesday, rising nearly 7% by the time the market closed. Investors cheered news that the connected-fitness company was relaunching an enhanced version of the treadmill after a voluntary recall earlier this summer.

The swift reintroduction of the product highlights Peloton's strong execution. In addition, it sets up the company well as it heads into the holidays. The new product could be a key catalyst for the growth stock if demand is robust and Peloton is able to ship more Tread products to customers than expected.

A woman running on a Peloton Tread.

Peloton Tread. Image source: Peloton.

Hello again, Peloton Tread

"The new Peloton Tread combines Peloton's award-winning content and quality design with safety features integrated into the experience to create an efficient and engaging total body workout experience," the company said in a press release about the product on Tuesday. It features a 23.8-inch touchscreen that tilts up and down 50 degrees and includes built-in speakers.

In Peloton Tread, the company utilizes both software and hardware to address safety. The treadmill features a four-digit, digital passcode that authorized users will have to enable use. There's also a safety key for users to clip on; the Tread belt will come to a rapid stop if it is detached. Further, Peloton emphasizes that the Tread's intuitive design means that the speed and incline knobs are "conveniently placed on the side rails, falling within a runner's natural arm swing so users can simply roll the knobs up or down mid-run to change the intensity of their workout." Finally, there's an easily accessible red stop button that will immediately stop the treadmill when pressed.

The company also said Tuesday that it is offering a free repair of the approximately 1,000 Peloton Tread units sold as part of a limited "pre-launch" in fiscal 2021 that will ensure that the touchscreen "will remain securely attached to the Tread." Newly manufactured Treads, of course, will incorporate these same improvements.

Peloton Tread will be available in the U.S., Canada, and the U.K. on Aug. 30, capturing the company's confidence in its ability to manufacture the device in high volumes. Further, the company said it plans to launch it in Germany this fall.

A material catalyst

It's too early to say how big of a catalyst the reintroduction of Peloton Tread will be for the company. But before Peloton voluntarily recalled the product, demand was robust enough for management to forecast Tread to be a meaningful contributor to revenue in fiscal 2022, which started on Jul. 1 of this year. While the recall certainly delays the product's revenue contribution, it will still likely be a catalyst in fiscal 2022, albeit weighted more heavily toward the final three quarters.

Importantly, Peloton Tread is the lower-priced treadmill product that the company will likely sell in higher volumes than its higher-priced Tread+. So if there's one treadmill Peloton investors should want the company to bring back first, it's Peloton Tread. The Tread+, which was also voluntarily recalled, is expected to take longer to come to market again.

Investors will probably get more information on how demand is looking for the reintroduction of Tread this week, as Peloton is set to report its fiscal fourth-quarter earnings after market close on Thursday, Aug. 26.