Fitbit Inc., San Francisco, reported $313.6 million in 2019 second quarter revenue and 3.5 million devices sold, year-over-year increases of 4 percent and 29 percent, respectively, according to financials released by the company on July 31.
However, weaker-than-expected Fitbit Versa Lite sales—and an overall downturn in the company's smartwatch business—prompted company executives to lower Fitbit's full-year 2019 guidance to a range of $1.43 billion to $1.48 billion, versus the previously stated target of $1.5 billion.
“While we are disappointed to lower guidance for the year, we remain confident in our long-term transformation strategy and have demonstrated good results across key areas of the business,” Fitbit CEO James Park said in a media release. “We saw growth in devices sold, increased active users and continued growth in our Fitbit Health Solutions channel, up 42 percent in the first half of 2019.”
During the quarter, Fitbit's adjusted EBITDA positively decreased from a loss of $55.8 million to a loss of $30.8 million. The company's overall net loss also positively decreased from a loss of $54.2 million to a loss of $35.8 million.
Fitbit's tracker revenue grew 51 percent, while smartwatch revenue declined 27 percent partly due to weak Fitbit Versa Lite sales.
International revenue represented 42 percent of total revenue ($133 million), and new products such as the Fitbit Inspire, Fitbit Ace 2 and Fitbit Charge 3 represented 68 percent of total sales.
“[W]e have made progress in diversifying our revenue towards building more predictable, recurring revenue streams with the launch of our premium services in two test markets," Park said in the release. "We are pleased with the initial results and expect a full launch this fall. Coupled with innovative hardware and software offerings, we believe we’re well positioned to bring more users to the Fitbit platform and continue to grow our business.”
In March, Fitbit announced that 2018 was its third straight year of revenue decline, despite the brand's growing user base.