Update: We have exclusive pictures of Fitbit's new "mass appeal smartwatch", which could be the long-awaited Fitbit Blaze 2."
The rollercoaster ride of Fitbit's financials took another dive as its fourth quarter earnings showed missed estimates and a company being squeezed by the competition. It does, however, plan to shift its business model and said it has a "mass appeal" smartwatch in the pipeline for later this year.
Fitbit raked in $570.8 million during its holiday quarter, falling short of analysts' $588 million estimate - and sending shares careening south. The company sold 5.4 million of devices for the quarter, but said there was higher demand for the Charge 2 and Blaze over the Ionic, something that was unanticipated.
Fitbit said that 67% of activations in Q4 came from new customers, while 33% came from repeat buyers. Its membership of users also grew 10% last year, climbing to 25.4 million.
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Fitbit says it's going to move away from an "episodic" model of seasonal product launches and towards more durable, recurring sources of revenue, including per-member, per-month sources on the healthcare side, like the deals with Blue Cross and Dexcomm it's already signed. It also sees more potential in its paid-for subscription service Fitbit Coach.
The company said its product lineup it will continue to be skewed more towards trackers than smartwatches, and that it expects new introductions to have a limited impact on revenue. However, it does expect the lineup to shift towards smartwatches by the end of the year. "We expect the lines between smartwatches and fitness trackers to continue to blur," said company CEO James Park.