“It was hard to overstate how important the fourth quarter was going to be for Fitbit,” Evan Niu writes for The Motley Fool. “Recognizing the fundamental shifts in the wearables market, Fitbit started scooping up defunct start-ups that it could cobble together to create a smartwatch two years ago, including Coin, Pebble, and Vector.”
“Those efforts culminated with the launch of Ionic late last year, Fitbit’s first full-fledged smartwatch that supported third-party apps and mobile payments,” Niu writes. “Unfortunately for Fitbit, Ionic has stumbled out of the gate.”
“Fitbit reported fourth-quarter earnings last night, and the disappointing results and forecast have sent shares to all-time lows,” Niu writes. “Revenue was close to flat at $570.8 million, which translated into a non-GAAP net loss of $4.7 million, or $0.02 per share. Devices sold declined by 17% to 5.4 million. Fitbit’s guidance for the first quarter calls for revenue to fall 15%-20% to $240 million-$255 million, far short of the $340 million in sales that the Street was expecting… It’s becoming increasingly clear that Apple is eating Fitbit’s lunch.”
Read more in the full article here.
MacDailyNews Take: Apple Watch roadkill.
Fitbit. Done in by a “toy.”
Fitbit devices are mere training wheels for Apple Watch. Fitbit products can only perform a very small subset of the kaleidoscopic range of features that Apple Watch offers users.
Fitbit is “beating” Apple in the same way as some Android phone and Windows PC makers are “beating” Apple: Unit sales. In other words, Fitbit (and some Android phone and Windows PC makers) can only “win” a race in which Apple does not compete.
Flooding the market with cheap junk is not winning. Selling units to the most desirable customers who spend billions within your ecosystems while reaping the lion’s share of the industry’s profits is winning. — MacDailyNews, April 20, 2016
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