Beleaguered Fitbit plunges to record low on disappointing smartwatch sales

Ari Levy for CNBC:

On Tuesday’s earnings call, Apple CEO Tim Cook commended his company for sticking with wearables “when others perhaps didn’t.” A day later, Fitbit CEO James Park struck a very different tone, telling investors in a press release that “we are disappointed to lower guidance for the year.”

Apple shares climbed 2.6% on Wednesday, closing at their highest mark this year. Fitbit shares closed at a record low on Wednesday and then plunged more than 15% in extended trading after the smartwatch maker’s earnings report.

Apple’s wearable business, which includes AirPods, Apple Watch and Beats headphones, recorded 48% growth in the quarter from a year earlier to $5.53 billion and CFO Luca Maestri said the category’s growth is accelerating over 50%. Fitbit’s sales grew only 4.8% in the quarter to $313.6 million.

At the end of 2018, Apple controlled 50% of the global smartwatch market in terms of units shipped, according to Strategy Analytics. Fitbit was second at 12.2%, followed by Samsung, which sells Android-powered devices, at 11.8%.

Following its after-hours plunge, Fitbit is now worth less than $1 billion. It has lost 82% of its value since its IPO in 2015.

MacDailyNews Take: It’s a winner-take-all market and Apple is the winner, taking all. As predicted:

Fitbit is the Palm of the twenty-tens. (And, BTW, we type that with Fitbits on our wrists. Apple should buy Fitbit just for the user base, merge Fitbit’s steps and other data into the Apple Watch, and be done with it. Then we could use our Apple Watches to compete with Fitbit-wearing friends and family who haven’t yet made the leap to Apple Watch and ditch these Fitbit Flex bracelets that we don’t want to wear, keep charged, etc. The only thing keeping Fitbit alive is their legacy user base and sequestering their step data.) — MacDailyNews, January 25, 2018