Since you are still under warrantee, you need to discuss this with your technician. Being a friend to that person can be the most helpful thing you ever do in your embroidery venture.
This is called 'birds nest' and has happened to everyone of us. I had it happen 1 hour ago. I removed my upper thread completely and rethreaded. Then I rethreaded my bobbin as well. I also used a flashlight to look at the bobbin case area and found a couple of pieces of lint/snippets that were very buried. I removed them with my tweezers. Frankly, most of the snippet was caught VERY tightly. I moved the machine wheel about 15 degrees at a time and finally got it all out. Remember that that thread got caught and release can be difficult.
You should have a 'slug' looking piece of equipment the size of a nickel but about 3/8" thick and on the heavy side. You should tie one end of the bobbin thread (which is encased in the bobbin case) and take the bobbin case and place the flat side against a wall. Allow the slug to drop and see how it does. It should be able to move somewhat, but not fall to the floor. If it falls to the floor, the bobbin case tension is too loose.
Other options -
If changing the needle doesn't fix the problem then change the bobbin. The bobbin can be wound too tight or too loose. It can also be lopsided or out of balance. Any of those problems will throw the tension off. Try a different bobbin to see if that fixes the problem.
Check the thread path from the spool to the fabric and everywhere in-between. Once the needle is threaded you should be able to pull thread through the needle with a slow gentle pull and the tension should feel the same as you pull several feet of thread through the needle. If it gets tighter then looser as you pull on it, or stops completely as some point, then there is a problem in the thread path inside the machine. If you can look inside for any obvious problems and see what is causing the thread jam up then you may be able to fix that yourself. I found a piece of plastic had cracked inside one of our machines and the thread would get caught in the crack. I'm not a repair technician but that was easy enough to fix at home.
Look at the plate that the needle passes through under the presser foot. Sometimes a needle will be pulled off-center enough to nick the plate where it passes through and put a bur in that plate. The bur then grabs threads as they go through and puts more tension on the thread at random.
Now check the tension! If you have a "bird nest" on the bottom then either the bottom tension (bobbin tension) is too tight OR the top tension (color thread) is too loose. The two tensions must be in balance in order to get designs to stitch out correctly. Look at your machine owner’s manual to find out how to set the tension on your particular machine.
Or ask your dealer to show you how to do it. Adjust the tension and try your design again.
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