Fitbit posts strong third-quarter revenue, says Apple Watch had no 'material impact'

Posted:
in Apple Watch edited November 2015
The Apple Watch had no "material impact" on Fitbit's sales in the third quarter, which saw revenue climb 168 percent year-over-year to $409.3 million, the company's CEO said in a results call.




Apple and Fitbit serve "two very different segments in the market" when it comes to the prices and purposes of devices, James Park told investors on Monday. Unlike the Watch, Fitbit devices are exclusively fitness-oriented and cost between $60 and $250. Even the cheapest Watch is $349, and prices can go as high as $17,000.

"We strongly continue to feel that the Apple Watch and Fitbit are targeting two very different consumers," Park said.

After the launch of the Apple Watch in April, some speculation arose that Fitbit sales would drop given the popularity of Apple products and the Watch's inclusion of motion and heart rate sensors. Another factor working in Fitbit's favor, however, is that the Watch is iPhone-only, whereas Fitbit products will also work with Android and Windows phones.

Fitbit shipped 4.8 million devices in the third quarter. Apple has so far kept the details of Watch sales a secret, although the company is believed to have made at least $1.688 billion from them since April.

Share prices for Fitbit have nevertheless fallen since Monday, but only in response to an announcement that it's offering another 7 million shares, while some shareholders will be selling off another 14 million.

Comments

  • Reply 1 of 19
    levilevi Posts: 344member
    Two different segments, though the fitness tracker space has limited upside. As smart watch tech and functionality improves, Fitbit will be seen as less and less compelling.
  • Reply 2 of 19
    levilevi Posts: 344member
    I will also say that the larger high-end Fitbit cuff is about the least attractive tracker I have ever seen. Seeing it in person on someone's wrist is jarring. The flex is much more subtle.
  • Reply 3 of 19

    Standalone GPS units for your car weren't killed in 2007.  It took a couple years.  

  • Reply 4 of 19
    cnocbuicnocbui Posts: 3,613member
    Quote:

    Originally Posted by sog35 View Post

     

    LOLlooloooLOLOOLOOLOOLOLLLLOLOLOLOLLO!!!

     

    This is just like when the point and shoot camera builders said iPhones had no impact on sales.

     

    Just wait till AppleWatch2 or 3.  When it has built in GPS it will be game over for fitbit.


    The P&S makers experienced a fall in sales, Fitbit sales increased nearly 300%, so you are about 400% away from reality.

  • Reply 5 of 19
    mac_128mac_128 Posts: 3,454member
    This makes perfect sense, Apple sells iPods of different functionality, currently ranging from $49 to $199+ Moreover, a device they recently updated for a market segment that has been in a steady decline for years.

    Until Apple offers the iPod Shuffle of watches, there will always be need for lower priced alternatives. As wearable functionality improves, adding "smart" elements to these more limited devices, like NFC and payment chips, will keep them in business with essential functionality. Not everyone needs all the features of the ?Watch. Notifications are not essential, among other bells and whistles included with the ?Watch.

    When the gen 2 Watch comes out, and the gen 1 watch drops down to $250, we'll finally get a better picture of how the ?Watch is going to errode the fitness band market, if at all.
  • Reply 6 of 19
    MacProMacPro Posts: 19,380member
    cnocbui wrote: »
    The P&S makers experienced a fall in sales, Fitbit sales increased nearly 300%, so you are about 400% away from reality.

    It could be argued that for a while there will be a halo effect from all of Apple's marketing that will benefitting all makers of fitness gear. Apple have grown the market I assume. People who had never thought of it become aware, look at the prices and decide to test the water at the low end. How long that benefit to non Apple devices will last remains to be seen. I think we are seeing this same scenario play out with Android phones. At some point when people become convinced this is a great idea they want the real deal.
  • Reply 7 of 19

    Sales of BBRY (RIMM) also went up for a couple of years after the iPhone. Look where they are now.

  • Reply 8 of 19
    sog35 wrote: »
    People said the same thing about Point and shoot cameras 
    People said the same thing about stand alone GPS
    People said the same thing about portable DVD players

    Those are all niche devices that iPhone destroyed.
    The Watch will do the same thing to stand alone activity trackers.

    There will still be a market for them, but it will be extremely niche and dominated by cheap POS like $20 China brands.

    Fitbit will be bankrupt in 3-5 years.  So much so I may take a short position on the stock next year.

    Smartphones as a whole helped destroy those markets. The iPhone was a major contributor but didn't do it by itself.
  • Reply 9 of 19
    lkrupplkrupp Posts: 9,456member

    Don’t ever kid yourselves. All market “segments” keep a keen eye on Apple at all times to see what the tech giant is up to. If they see the slightest hint that Apple is eyeballing their turf they go into instant panic mode. Hence the blathering from Elon Musk, Swatch, Fitbit, the entire Swiss watch industry. It gets comical at times. “No, no, no, we’re not worried about Apple, hah, ha, hah. Then the CEO goes into their private bathroom and shits their pants.

  • Reply 10 of 19
    Fitbit and Apple Watch do target different, but similar market segments. So it shouldn't be surprising to see Fitbit expand sales, what with awareness of wearables increasing due to the aurora surrounding Apple products.

    That said Blackberry sales increased for several quarters after the iPhone was introduced. Today it's near impossible to find one.

    On the high end I think the Apple Watch is already the dominant wearable, but it's still early in the game, come back in 2 years and let's see how things are shaking out then.
  • Reply 11 of 19
    The "smart phone" as we know it today didn't exist prior to the iPhone. Prior to the iPhone "smart phones" we're cumbersome handsets with email capabilities and limited additional functionality. [SIZE=4][COLOR=blue]ALL[/COLOR][/SIZE] [SIZE=3][/SIZE] smartphones today are inspired by the original iPhone. None resemble the 2007 Blackberry (except for rare Blackberrys).
  • Reply 12 of 19
    peteopeteo Posts: 395member

    So Apple sells a Billion dollars worth of apple watches and its a failure, Fitbit sells $409m and its a raging success. I guess I don't get Wall street  

  • Reply 13 of 19
    calicali Posts: 3,494member
    The Watch is doomed. Fitbit will destroy it.

    But seriously I think if Apple Watch sales aren't too great then Apple will pull out bigger guns for gen. 2, it has to happen regardless. We're gonna see exclusive features we never even thought of. I know Apple hired an engineer that focuses on super advanced level fitness tracking. Like sci-fi level sh**.
    sirlance99 wrote: »
    Smartphones as a whole helped destroy those markets. The iPhone was a major contributor but didn't do it by itself.

    android phones are just cheap imitations of iPhone.

    If someone had told me in 2006 that a future Apple invention would be used by 3 billion people, I'd be in disbelief.
    lkrupp wrote: »
    Don’t ever kid yourselves. All market “segments” keep a keen eye on Apple at all times to see what the tech giant is up to. If they see the slightest hint that Apple is eyeballing their turf they go into instant panic mode. Hence the blathering from Elon Musk, Swatch, Fitbit, the entire Swiss watch industry. It gets comical at times. “No, no, no, we’re not worried about Apple, hah, ha, hah. Then the CEO goes into their private bathroom and shits their pants.

    *Steve Ballmer laughing at iPhone gif*

    ^someone please make it.
  • Reply 14 of 19
    sirlance99 wrote: »
    Smartphones as a whole helped destroy those markets. The iPhone was a major contributor but didn't do it by itself.

    - the iPhone redefined smartphones and smartphone camera expectations, and was immediately cloned
    - the iPhone camera remains the #1 device on photo sites like Flickr
    - the iPhone is the single-best-selling smartphone
    - apple is the biggest camera seller by volume.

    so yeah...it basically did it by itself.
  • Reply 15 of 19
    jungmarkjungmark Posts: 6,866member
    Doomed! "168% increase > what Apple claims on the watch," Wall Street analysts say.

    Different market segments. I wonder how fitbit's competitors made out.
  • Reply 16 of 19
    mac_128mac_128 Posts: 3,454member
    mieswall wrote: »
    Sales of BBRY (RIMM) also went up for a couple of years after the iPhone. Look where they are now.
    It's really not the same thing at all. Nobody needs an ?Watch. It's not a commodity like a mobile phone that people can't live without.
    Moreover the stainless Watch costs as much as the iPhone 6. For someone who just wants to track their fitness, that's a big commitment. Also, Black berry dismissed and ignored Apple. If Fitbit does the same thing as Apple enters their market segment, then they deserve Blackberry's fate. But it took Apple a long time to enter the Android space. Unless they've really changed their tactics, I doubt the ?Watch will be a race to the bottom either.
  • Reply 17 of 19
    jlanddjlandd Posts: 873member
    Quote:

    Originally Posted by SirLance99 View Post

     
    Quote:

    Originally Posted by sog35 View Post



    People said the same thing about Point and shoot cameras 

    People said the same thing about stand alone GPS

    People said the same thing about portable DVD players



    Those are all niche devices that iPhone destroyed.

    The Watch will do the same thing to stand alone activity trackers.



    There will still be a market for them, but it will be extremely niche and dominated by cheap POS like $20 China brands.



    Fitbit will be bankrupt in 3-5 years.  So much so I may take a short position on the stock next year.




    Smartphones as a whole helped destroy those markets. The iPhone was a major contributor but didn't do it by itself.

     

    Yup.  Plus, there's a HUGE difference in a small camera that costs $100 loosing its market to a device that was on your phone (not even smart phone) whether you wanted it or not, the phone being a device and service you were not going to do without, and a $75 dedicated fitness device loosing its to a $600 one that may do much more but not without the rest of your ecosystem being involved.

     

    The market for a product like a Fitbit would be in trouble if there was a Watch bundled for $100 extra with every iPhone.  Otherwise I expect there to be more than enough $75 Fitbit type presents for Xmas.  They're not competing for the same dollar any more than iPads are for XBox dollars.

  • Reply 18 of 19
    badmonkbadmonk Posts: 992member
    Plus APPL boxes them in from moving their product line upstream in cost/value.
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