Fitbit Sales Skyrocket, beats Expectations
Fitness wearables company Fitbit reported its second-quarter results after the market closed on Aug. 2. The company has been ramping up spending on R&D in an effort to deliver new products to market quickly, while big increases in marketing have been helping to sell those new products. Fitbit’s profits tumbled during the second quarter thanks to this heavy spending, but the company also shipped more devices and grew revenue at a blistering pace.
The company has been spending heavily to diversify its portfolio of colorful wristbands and clippable devices that track calories, sleeping patterns and heart rate, as well as enter new markets. Fitbit’s new products, Blaze and Alta and related accessories, accounted for 54 percent of revenue in the second quarter, up from 50 percent in the preceding quarter, the company said on Tuesday.
About two-thirds of the total activation of Alta and Blaze were by new customers, while the rest were by those who own, or previously owned another Fitbit device, the company said.
It’s also raking in the big dollars, with revenue 46.5% up, standing at an impressive $586.5 million for the quarter.
The company’s net income attributable to shareholders fell to $6.3 million, or 3 cents per share, from $7.1 million, or 7 cents per share, a year earlier. Fitbit’s operating costs more than doubled to $235.3 million in the quarter.