Fitbit’s revenue grew 9.7% in the first quarter
Fitbit (FIT) announced its first-quarter 2019 results on Wednesday, May 1. The fitness tracker company continued to rebound after several quarters of decline. The company generated $271.9 million in revenue during the quarter, a 9.7% increase YoY, which was higher than Wall Street’s estimates of $259.7 million.
The company’s net loss shrank from $80.9 million to $79.5 million YoY. However, the company’s gross margins narrowed to 32.9% in the first quarter from 46.0% in the same quarter last year, as the company cut prices on some of its devices to boost sales. The company said that its average selling price fell 19% YoY.
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Fitbit’s smartwatch shipments grew 117% YoY
The turnaround in the company’s fortunes has been driven by a focus on smartwatches. The company said that its smartwatch shipments grew 117% YoY in the first quarter and accounted for 42% of the company’s revenue. Meanwhile, fitness tracker sales also seem to have improved with shipments growing 17% YoY. Total devices sold by the company was up a robust 36% YoY.
The company’s second foray into smartwatches was Versa, which was launched in February last year. The launch was quite successful in contrast to Ionic’s lukewarm reviews. The company launched a cheaper version of Versa this year called Versa Lite.
The company is also increasing its focus on health solutions. The company said that revenue from its Fitness Health Solutions business grew 70% YoY to $30.5 million.
Fitbit is taking small steps towards revival. The company expects its revenue to grow 2% to 7% YoY in the current quarter. The stock rose over 2% in after-hours trading on Wednesday.