Just a week after its competitor filed a second lawsuit against it, Fitbit prepares for its initial public offering (IPO) on Thursday by increasing its proposed initial price per share.
Jawbone, San Francisco, filed a complaint last week essentially claiming Fitbit's products violate Jawbone patents, according to an Associated Press report. Jawbone asked the court to stop Fitbit from producing and selling products. Jawbone wants a jury trial to resolve the issue and is seeking damages, attorney fees and other payments if the court deems it appropriate.
Jawbone filed a separate suit in May, alleging Fitbit stole employees and trade secrets. Jawbone is also seeking a jury trial in that case.
Fitbit also was targeted by a class-action lawsuit in May that made seven claims against the company, including false advertising, unfair competition and fraud related to sleep data.
Despite these suits, the San Francisco-based company increased its proposed maximum offering price per share to $19, according to an amended registration statement filed with the Securities and Exchange Commission on Wednesday. Fitbit expects the price for its Class A common stock to sell between $17 and $19 per share when it goes public Thursday on the New York Stock Exchange under the FIT symbol.
At the midpoint of the range, Fitbit would be valued at approximately $3.7 billion. The company said it would offer 22.38 million shares, and selling stockholders are offering 12.11 million shares. Fitbit estimates net proceeds at $373.9 million based on an assumed IPO offering price of $18 per share.
Fitbit reported net income of $131.8 million on revenue of $745.4 million in 2014 and earned $48 million on revenue of $336.8 million in first quarter 2015. The company reported income of $4.2 million in 2012 and $51.6 million in 2013.
Fitbit produces six wearable trackers with price points ranging from $59.95 to $249.95. Core functions of each device include tracking daily steps, calories burned, distance traveled, floors climbed as well as displaying real-time feedback to users.
The company sold 1.3 million devices in 2012, 4.5 million devices in 2013 and 10.9 million devices in 2014. As of March 31, Fitbit had sold more than 20.8 million devices since the company's inception in 2007, according to its SEC filing.
In March, the company purchased FitStar, a platform for delivering personal workout videos and fitness routines over mobile phones.
Fitbit’s products are sold in more than 45,000 retail stores in more than 50 countries, according to its filing. Fitbit reported 6.7 million active users at the end of 2014, up from 2.6 million active users in 2013.
Fitbit held the leading position in the U.S. connected activity tracker market with an 85 percent share, by dollars, in the first quarter of 2015, according to The NPD Group.