Categories Earnings, Technology

Fitbit (FIT) slips to loss in Q3 as revenues fall 12%; stock dips

Less than a week after agreeing to be acquired by Alphabet’s (NASDAQ: GOOG) Google, Fitbit (NYSE: FIT) reported a net loss for the third quarter, on an adjusted basis, as the wearables maker’s revenues declined amid growing competition. Revenues, meanwhile, topped Walls Street’s expectation.

Fitbit (FIT) Q3 loss widens as revenues fall 12%

On an adjusted basis, the tech firm reported a loss of $0.10 per share for the September-quarter, compared to earnings of $0.04 per share last year. The loss matched analysts’ forecast. Reported net loss was $51.9 million or $0.20 per share compared to a loss of $2.1 million or $0.01 per share in the third quarter of 2018.

Revenue down 12%

The deterioration reflects a 12% decline in revenues to $347.2 million, which is slightly above the consensus estimate. Around 3.5 million devices were sold during the quarter, unchanged from last year. The top-line was hurt manly by unfavorable pricing.

Mixed Outcome 

Smartwatch revenue increased year-over-year, while tracker revenue declined. There was a 10% growth in Fitbit Health Solutions revenue. The number of active users at the end of the period was up 9% from last year.

James Park, CEO of Fitbit, said, “The continued success of the Fitbit brand is built on the trust of our users, and our commitment to strong user privacy and security will not change. I’m excited about the combination of Fitbit and Google and look forward to closing the transaction and further advancing our vision and mission, accelerating innovation in the category and ultimately helping more people around the world get healthier .”

The company managed to limit the impact of unfavorable market conditions on its performance by shifting the business towards the faster-growing smartwatch category, with the introduction of Versa 2, and by expanding Fitbit Health Solutions.

Google Deal

Last week, the company entered into a definitive agreement to be acquired by Google in an all-cash deal that values it at $2.1 billion. The stockholders will receive $7.35 per share in cash upon the closing of the transaction,which is expected in 2020. The management will not be hosting a conference call due to the pending acquisition.

Related: Fitbit Q2 2019 Earnings Conference Call Transcript

Shares of Fitbit gained steadily after slipping to an all-time low earlier this year. The stock moved up 26% since the beginning of 2019 and closed Wednesday’s regular session lower.

Follow our Google News edition to get the latest stock market, earnings and financial news at your fingertips

Most Popular

Stitch Fix (SFIX) Stock: Will the innovative biz model survive virus-led slump?

The business world is still struggling to come out of the virus-induced slowdown, but it seems almost every retail segment benefited from the pandemic at some point. The vaccination drive

General Mills (GIS): Three factors that are expected to help drive growth for the food company going forward

Shares of General Mills Inc. (NYSE: GIS) were up 3.2% on Wednesday after the company delivered better-than-expected results for the first quarter of 2022. Net sales rose 4% year-over-year to

IPO Alert: Allvue Systems sets IPO terms, to raise around $290 million

It is estimated that the alternative investments industry has expanded at a compound annual rate of 10.2% over the past ten years and had $11 trillion in assets under management

Add Comment
Viewing Highlight