Garmin struggles against Fitbit in a battle of the fitness bands

Garmin has revealed its second quarter earnings for 2015 - and it's looking wobbly
Garmin struggles against Fitbit

Garmin's second-quarter earnings have been released, showing its stalling fitness tracker sales, while Fitbit continues to grow and grow.

Garmin has been in the wearable tech game for a while now, but recently it's seen its earnings from sales of fitness wearables, including its GPS watches and trackers, decrease. In the last quarter of 2014, takings from its fitness sales grew 70% year on year, but 2015 has seen a first quarter growth of a more modest 31% and now a second quarter increase of just 5%.

Essential reading: Best GPS running watches

This comes as an investor alluded to Fitbit enjoying something in the region of 120% growth in Q2 of this year. Analyst reports are now forecasting up to 180% year on year growth for Fitbit on the back of success for the Charge, Charge HR and Surge devices.

In Garmin's earnings call with investors, CEO Cliff Pemble defended the current growth stall, putting it down to a lack of new products in that period and unfavourable currency markets. Although it's not the company's largest earner (surprisingly it only makes 20% of its revenue from fitness watches), the market still has a lot of potential worth investing in.

Pemble came under questioning from investors, one asking how long Garmin would continue to invest in the tracker market before he would think about "curtailing it" considering there's a "well-established leader". That's almost definitely Fitbit which was valued at $4.1 billion after its IPO.

Versus: Garmin Forerunner 225 v Fitbit Surge v TomTom Multisport

Garmin's CEO responded by pointing to investment in areas such as advertising which is significant as Fitbit is widely seen to have won the marketing war. "You asked how long we would continue to invest in R&D and our mode of increasing investment right now," he said. "The market is growing rapidly and so consequently the opportunity is there and we feel it's the right time to invest in these things."

Here at Wareable, we are big fans of Garmin's running watches, giving the Fenix 3 and the Garmin Forerunner 620 and 920XT four and a half stars. However, the company's fitness bands such as the Vivofit 2 and more casual sports smartwatches such as the Vivoactive are under threat by Fitbit and Jawbone, whose products are cheaper and garnering better recognition among new, less hardcore fitness consumers.

3 Comments

  • agmanton says:

    I love my garmin vivosmart, my wife has a jawbone up2 and personally i think the vivosmart is a lot better and the app now its been updated is great and a lot more "grown up" than the jawbone app. The other possitive is the display on the vivosmart can display your texts, incoming calls, emails and shos all the data you would want to know. The fact that it is fully waterproof as well (not many others are for the price) is a big bonus as you can swim, shower etc. All in all a great product and I highly recommend it.

    • BenS says:

      My wife went through two Jawbone UP24s in about three months (both died), before getting an Vivofit 2 which is better in every way (1-year battery, full waterproof, always-on screen, etc). I hope Garmin continues to invest in activity trackers and watches.

  • paulhart12 says:

    I think if Vivofit 2 had vibration alarms and a better app (jawbone is the best app hands down) then it would knock it out of the park!!!

    The vivofit  garmin connect app is terrible.  no real interpretation of the data, just slapped on  the screen and not combined with the steps/exercise like Jawbone is.Pairing is awful too. 

    the vivofit 2 band is great, and the display is vibrant.  PLEASE UPDATE with vibration/ smart alarms and make the app great !!!! 

    Soon Jawbone will get there band smoothed out and crush you.

    If you wont fix the app, make Garmin devices work with Jawbone app!!!!

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