Fitbit, which is one of the most popular wearable device maker, on Wednesday, released the quarterly results that exceeded Wall Street expectations. In the second quarter, the manufacturer further enhanced its smartwatches in its product line. That’s why the Fitbit Versa model achieved high sales.
In the second quarter, sales of Fitbit smartwatches accounted for 55% of total revenue. Fitbit’s total revenue was $299.3 million, exceeding analysts’ average estimate of $285.4 million.
In the after-hours trading of US stocks on Wednesday, Fitbit shares rose 3% to $6.11. In the second quarter, Fitbit shipped over 2.7 million units, more than the 2.5 million analysts estimated in FactSet statistics.
Fitbit is known for its sports bracelets, but is a latecomer in the smartwatch market. This manufacturer is mainly struggling in the US market, where Apple and Samsung are leaders. Fitbit CEO, James Park said that during the quarter, Versa smartwatches sold more than Samsung, Garmin, and Fossil smart watches in North America. However, earlier in the day, Fitbit’s competitor Garmin also announced better-than-expected quarterly profits. This shows that the smartwatch market is experiencing higher demand.
As you should know, Fitbit produces most of its products through the Chinese business. The company said that if the US proposal to further impose tariffs on Chinese imports would take effect, it would affect the cost of raw materials. Regardless of possible tariff effects, the company’s full-year revenue is expected to be $1.5 billion.
Currently, the company expects the third-quarter revenue would be $370 million to $390 million. But many analysts expect it to be around $377.6 million.
At last, in the second quarter (ended June 30), Fitbit’s net loss expanded to $118.3 million, or 49 cents per share, up from $58.2 million, or 25 cents per share, in the same period last year. Adjusted earnings per share were 22 cents, lower than analysts’ average estimate of 24 cents in Thomson Reuters.