Fitbit Rebounds, Revenue Up 10%
Smart wearables manufacturer Fitbit has continued its financial rebound in Q1 2019, posting US$271.9 million in revenue beating Wall Street’s forecast of US$259.7 million, attributed to the company’s increased focus on smartwatches which grew 117% YoY.
Business Insider reports that shares rose 2% after the results were posted, with Fitbit reporting a loss of US$0.15 a share, better than the expected loss of US$0.22.
The wearables maker is facing increased competition from Samsung, Garmin, and Apple — who has become a major player in the smartwatch space, taking over the dominance which Fitbit once enjoyed.
To combat the continuing threat from Apple Watch, Fitbit has focused on providing more affordable smartwatch options, notably the well-received Fitbit Versa Lite Edition.
The Versa Lite Edition is a pared down version of the Versa line which omits certain features while retaining the most important fitness tracking abilities.
“New users are continuing to join the Fitbit platform with active users increasing in the first quarter, underscoring the effectiveness of our strategy to bring more users onto the Fitbit platform with the introduction of more accessible, affordable devices,” said James Park, co-founder and CEO in the earnings release.
Although smartwatches have provided the majority of revenue, trackers also saw growth of 17% YoY.
Fitbit attributed this to the recently launched Inspire and Inspire HR fitness trackers which sparked the first quarter of YoY growth in tracker sales in three years.
“We saw continued momentum across our business in the first quarter, with revenue up 10% and devices sold up 36% year-over-year,” said James Park, co-founder and CEO.
“In addition, our Fitbit Health Solutions business grew 70% with revenue of $30.5 million, demonstrating great progress towards our $100 million revenue target for 2019.”
Due to the increased amount of cheaper but effective trackers and smartwatches, Fitbit expects sales of devices to increase on Q2 and continued revenue growth in 2019.
Read the full report here.