Stock fell 6.6% last week
Fitbit (FIT) stock fell 6.6% in the week ended May 4 to close at $4.95 per share. The stock has generated returns of 22.0% in the last 12 months and 3.6% in the last month after falling 22.0% in 2017. Fitbit is trading 10.0% above its 52-week low of $4.51 and 32.0% below its 52-week high of $7.32.
Fitbit announced its 1Q18 results on May 2, reporting revenues of $248.0 million for a fall of 17.0% YoY (year-over-year). Its non-GAAP (generally accepted accounting principles) EPS (earnings per share) reached -$0.17 in 1Q18, higher than its expected EPS of -$0.19. Analysts expected Fitbit to post revenues of $247.1 million in 1Q18.
Revenue guidance drove stock downward
Fitbit stock fell despite the company beating its earnings and revenue estimates. Fitbit expects its revenues to fall 16.0%–22.0% in 2Q18 with estimated EPS from -$0.23 to -$0.27. Fitbit had posted break-even non-GAAP EPS in 2Q17. Fitbit expects its revenues to fall 7.0% YoY to $1.5 billion in fiscal 2018.
Fitbit has been struggling to compete with Apple and low-cost manufacturers like China’s (FXI) Huawei and Xiaomi in the wearables market.
Although Fitbit’s shipments fell 27.0% YoY to 2.2 million devices in 1Q18, the firm’s average selling price (or ASP) rose 16.0% to $112.00. Devices such as Versa, Ionic, and Aria 2 drove device sales in 1Q18.