Tag: Fitbit

Fitbit’s first true smartwatch hits snags

Fitbit was planning to release its first “proper” smartwatch but the project has been blighted by a series of production mishaps.

The fitness tracker company’s smartwatch project was supposed to be released in the spring, but production problems have forced Fitbit to push the launch to the autumn.

In one of the more final prototypes, the GPS didn’t work because the antenna wasn’t in the right place. Designers had to go back to the drawing board to redesign the product so the GPS got a strong signal.

Then there was the problem of making the watch fully waterproof so that it could compete with Apple’s Watch Series 2. At the moment, it is unclear if Fitbit will make the watch fully waterproof in time for the launch.

The Tame Apple Press is dancing in the street over the delays. The smartwatch market is limited and Apple has sewn up the numbers of clients who want one. Fitbit was a possible contender to take the market away from Jobs mob. It already has a good reputation in the fitness tracker market.

Fitbit runs out of breath

f89d75a69595b21228964ff6170a9953Fitness device maker Fitbit is predicting that its key-holiday shopping quarter will fall well below of analysts’ estimates, hurt by soft demand and production issues related to its new Flex 2 wristband.

Shares of the company, which also reported lower-than-expected quarterly revenue, immediately plummeted by a third and were set to hit record-low levels on Thursday.

Fitbit forecast revenue of $725 million to $750 million for the October-December quarter, while the cocaine nose-jobs of Wall Street thought that $985.1 million was more reasonable.

This implied revenue growth of 5.4 percent at the top end. Analysts were expecting growth to pick up to 38.4 percent from the 23.1 percent in the latest third quarter, which is the smallest rise since the company went public in June 2015.

Chief Executive James Park said the outfit was growing and was profitable, just not at the level that people expected.

Fitbit’s transition to its newer products, greater-than-anticipated softness in the wearables market and production issues with the new Flex 2 wristband were the chief causes for the weak outlook, Chief Financial Officer Bill Zerella said.

The production issue – Fitbit found it “incredibly difficult” to find small-enough batteries to fit – started in the third quarter and is not expected to be resolved before the end of December, Zerella said. He estimated that hit Fitbit’s revenue forecast by about $50 million.

Fitbit, which launched two new fitness wristbands, Charge 2 and Flex 2, in late August, said it sold 5.3 million devices in the quarter, edging past analysts average estimates of 5 million, according to research firm FactSet StreetAccount.

However, the average selling price for its devices fell to $93 from $99 in the prior quarter, and missed analysts’ average estimate of $98.25.  All this meant that Fitbit’s total revenue of $503.8 million missed analysts’ average estimate of $506.9 million.

It was also not particularly popular in the Asia Pacific market where it fell 45.1 percent to $35.7 million.

Operating expenses jumped 52.4 percent, largely due to higher research and development costs. The company’s net income plunged about 75 percent to $26.1 million.

 

Punters lose interest in gadgets and gadget makers

GadgetIn the middle of the Christmas shopping, expensive electronic gadgets like GoPro and Apple watches were being ignored, despite discounting.

Five of the six consumer electronics shares in the Russell 3000, including camera maker GoPro, headphone maker Skullcandy and GPS maker Garmin were down.  Apple shares have also been suffering.

According to a USA TODAY analysis of data from S&P Capital IQ, the gadget makers are down on average by 21 percent.  In fact the only one doing well is an outfit called ZAGG which makes coatings to help people protect the screens of devices they already own. ZAGG shares are up 61 percent this year.

Investors expected bigger things from the gadget market. It seemed logical that everyone one wanted everything digital.  Apparently clothes sales were better.

Apple and Fitbit have been adding features to their products to keep up interest but it does not appear to have worked. Shares of Fitbit are essentially flat from their first day of trading following the June initial public offering and down 44 percent from its high this year. Apple, too, has snapped its winning streak for investors and is now down three percent at the end of the year.

GoPro fell 71 percent this year as just about everyone who wanted a camera to record their extreme sports escapades has one. The company’s revenue growth over the past 12 months is still a respectable 62 percent, but that’s well below the 263 percent growth in 2011. The future is the more troubling part. Analysts are now expecting GoPro’s revenue to gain just 11.6 percent in 2016.

Wearable market blossoms

Apple WatchThe relatively new “wearables” sector blossomed in the third quarter, with shipments up 197.6 percent compared to the same quarter last year.

IDC said that Xiaomi and XTC look like they will be strong contenders in the sector, in which IDC includes both basic wearable devices and so-called “smart” devices, like the Apple watch.

Chinese vendors in general appear to have leaped onto the wearable bandwagon, said Ramon Llamas, research manager at IDC.

“China has quickly emerged as the fastest growing wearables market, attracting companies eager to compete on price and feature sets.”

Shipment volumes for both basic fitness tracking and more sophisticated gadgets have both increased.

IDC said there’s a bifurcation not only in features but in pricee too, with smart watches costing over $400 and basic unites at $95 or so.

Fitbit is the king of the wearables castle, while Xiaomi’s cheap Mi Band selling over 97 percent of volumes in its home market.

Wearable market sees Apple soar

Apple watchAfter coming from nowhere earlier this year Apple has found itself second in the wearables market, according to IDC second quarter figures worldwide.

The leader in the market is Fitbit, but that company shipped 4.4 million units in Q2 while Apple managed to ship 3.6 million units.

Volumes for the second quarter amounted to 18.1 million units, up 223.2 percent from the same quarter last year.

Analyst Ramon Llamas at IDC said that Apple’s arrival in the market drove total volumes higher and its rise from nowhere will cause other vendors to look again at their products.

“Fairly or not, Apple will become the stick against which other wearables are measured, and competing vendors need to stay current or ahead of Apple,” he said. He also predicts Apple may well launch smart glasses or even “hearables”.

The top five vendors are now Fitbit, Apple, Xiaomi, Garmin and Samsung with market shares of 24.3%, 19.9%, 17.1%, 3.9%, 3.3% respectively. “Others” have 31.5 percent of the total market.

Wearables market continues to grow

WatchNot everyone will want to have a computer on a tie or a blood pressure monitor in their socks, but according to a report on the marketplace, wearable devices really are beginning to take off.

IDC said vendors shipped 11.4 million wearable devices in the first quarter of this year, that’s up 200 percent from the same quarter last year.

But the big question is how well the Apple iWatch is going to do. And IDC still thinks the jury is out in this case.

What’s clear, however, is there is considerable price erosion in the market with 40 percent of the devices now priced under $100. Apple’s offerings, of course, are considerably more expensive than that. Jitesh Ubrani, a senior analyst at IDC, said: “Apple’s entrance with a product priced at the high end of the spectrum will test consumers’ willingness to pay a premium for a brand or product that is the centre ofattention.”

Currently, the top five vendors in the first quarter are Fitbit, Xiaomi, Garmin, Samsung and Jawbone. Most of these are health related apart from Samsung’s Gear watch.

Here are IDC’s figures for the top five.