Fitbit (FIT) Q1 Loss In Line With Expectations, Revenues Top
Zacks Investment Research | May 04, 2017 10:48PM ET
Fitbit, Inc. (NYSE:FIT) reported first-quarter 2017 adjusted loss (excluding all one-time items but including stock-based compensation) of 25 cents per share, which was in line with the Zacks Consensus Estimate. Revenues beat the consensus mark by $12.5 million.
Results declined year over year as increased competition from fitness-device makers like Garmin (NASDAQ:GRMN) and Jawbone and increased popularity of smart watches resulted in slower growth in the fitness wearable space.
At the call, management highlighted some recovery initiatives that are already in place. These include an executive shakeup and cost structuring.
In the quarter, the company realigned under two main businesses - Consumer Health & Fitness and Enterprise Health. The Consumer Health & Fitness business focuses on delivering more efficient health and fitness devices, diversifying into the smartwatch category and offering premium software and services.
Enterprise Health, on the other hand, focuses on developing and strengthening relationships with employees, insurance companies, health systems and healthcare partners. Only time will tell if these moves really work and give Fitbit a chance to make a comeback.
We note that Fitbit’s growth has been slowing down with smartwatches outshining the fitness wearable category, influx of new wearables, lack of upgrades among existing users and lackluster growth in the Asia Pacific region.
The impact of these headwinds has been significant on the stock, which underperformed the Zacks Zacks Investment Research
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