It's quarterly earnings time again, and while Fitbit has bettered analyst expectations, it's making no secret of the fact that it's going all-in on its upcoming smartwatch - which will launch by the holiday period.
Despite slightly outperforming predictions, Fitbit still saw a 40% revenue slump (its third quarterly decline in a row). It said that over 12 months, the Fitbit Charge 2, Alta HR and Flex 2 made up 81% of revenue, with a total of 3.4 million devices sold, and that in the US, Charge 2 is the highest selling of its trackers.
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But everything is heading towards the smartwatch, which Fitbit hopes will drive it back towards profitability by Q1 next year. "Our smartwatch, which we believe will deliver the best health and fitness experience in the category, is on track for delivery ahead of the holiday season and will drive a strong second half of the year," said CEO James Park.
Rumors were already pointing towards a fall launch, so it's good to hear Fitbit finally confirm we'll have it before Christmas, considering all the rumors of production difficulties. Park also confirmed the watch will be water resistant to 50m, but still hasn't mentioned whether we'll see a mobile payment system. He did reiterate there will be an "app gallery" at launch featuring a select number of partners, but set expectations that the number of available apps will likely be low.
"We expect apps from a lot of other third-party developers to stream in after the launch," said Park. "It's going to take them a little bit of time for them to learn the tools and the SDK."
Interestingly, he also said that Fitbit was looking into tackling more serious health conditions, specifically mentioning sleep apnea, which was recently rumored to be on the cards. Park also said hypertension and arrhythmia were things they could one day look to treat.
What wasn't mentioned was plans for future trackers. A recent report claimed Fitbit was working on Charge 3 and Blaze 2 devices for 2018. If Fitbit is leaning this heavily on the smartwatch, it begs the question of what happens if it's not the resounding success it hopes for. With no other upgrades on the near-term horizon, it's going to have to hope that the watch can convince existing Fitbit users to upgrade, as well as attracting new customers.
Park remained bullish about the prospects for Fitbit in the overall health and wellness space, which the company believes will be what helps carry it on the road ahead. "We have a firm vision for the future," he said. "Devices are a means to an end".