Fitbit continued strong system progress for Q2, up 31%, yr over yr, representing a 5% bump in income. From that angle, the corporate’s long-term turnaround seems to be on observe — however issues weren’t all cheery this trip. Notably, the corporate’s inventory is down in after-hours buying and selling after it lowered steering for annual income.
The corporate laid a lot of the blame on the toes of the Versa Lite. Introduced in March, the $160 system is a stripped-down model of the Versa, the smartwatch that helped kickstart Fitbit’s most up-to-date act.
“Whereas we’re disenchanted to decrease steering for the yr, we stay assured in our long-term transformation technique and have demonstrated good outcomes throughout key areas of the enterprise,” CEO James Park mentioned in a launch tied to the earnings. We noticed progress in gadgets offered, elevated energetic customers and continued progress in our Fitbit Well being Options channel, up 42% within the first half of 2019.”
All instructed, smartwatch income dropped 27% yr over yr, with the Lite making up a decrease than anticipated 38% of that quantity. In the end the corporate’s not too long ago consolidated tracker presents have been there to select up a number of the slack, with a 51% yr over yr improve.
The stumbles are available in distinction to this week’s Apple earnings, which discovered wearables on the upswing as iPhone gross sales continued to sputter. Along with a newfound deal with smartwatches, Fitbit’s latest shift additionally features a healthcare providing. Fitbit Well being Options is up 42% for the yr, with worldwide progress taking part in a key position.