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Fitbit Looking to Leverage Its Large User Base

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25 million active users

Fitbit (FIT) has seen its revenues decline for five consecutive quarters. That could extend into fiscal 2018 with another fall in revenue. We’ve seen how Fitbit is trying to attract customers by launching new products. It has launched two products since September 2017 and is now hoping those devices will drive revenue in 2018 and beyond.

Fitbit is still a major player in the wearables space with more than 25 million active users on its platform. According to Fitbit, that demonstrates “the power of the company’s software and social experience to drive engagement and long-term growth of its community.” The growth in its user base might indicate customer engagement and retention.

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According to market research firm NPD, the Fitbit Charge 2 is the top-selling fitness tracker in the United States. Amazon (AMZN) labeled the product a top-seller in the health and fitness vertical during the holiday season last year. Fitbit has claimed to be the number-one fitness application on Android (GOOG) (GOOGL) and iOS in the United States.

Morgan Stanley not optimistic about Fitbit

Fitbit stock fell 10% on April 2 after investment bank Morgan Stanley (MS) downgraded the stock and revised its 12-month price target from $5 to $4. Morgan Stanley said the wearables market is transitioning from basic fitness trackers to smartwatches.

Fitbit launched the Ionic in September. However, it didn’t drive revenue as expected. It then launched the Versa at a lower price, hoping to attract customers. Morgan Stanley downgraded Fitbit to “underweight” and modeled a price target of $2 for the stock in a bearish scenario.

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