Fitbit Inc

(Fitbit Inc)

FitBit Shares Plunge On Weak Profit

Earnings Reuters

Wearable fitness device maker Fitbit Inc forecast current-quarter profit way below Wall Street expectations, as the company invests heavily to market its new products, sending its shares down 15 percent in after-hours trading.

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The weak forecast overshadowed bigger-than-expected quarterly revenue and profit, boosted by strong demand in the holiday shopping season.

Fitbit said on Monday it expects adjusted profit of break-even to 2 cents per share for the quarter ending March, lagging analysts' expectation of 23 cents, according to Thomson Reuters I/B/E/S.

Fitbit last month unveiled its own smartwatch, the $200 Blaze, which it expects to ship in March, to mixed reviews. Earlier this month, the company announced a new wristband, the Alta, to appeal to the more fashion-conscious customer.

Fitbit said it sold 8.2 million of its colorful wristbands and clippable devices that track calories, sleeping patterns and heart rate in the fourth quarter ended Dec. 31. That represented a 55 percent jump from a year earlier.

The company's net income attributable to common stockholders rose to $64.2 million, or 26 cents per share, in the fourth quarter ended Dec. 31, from $11.9 million, or 19 cents per share, a year earlier.

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On an adjusted basis, Fitbit earned 35 cents per share.

Revenue soared to $711.6 million from $370.2 million.

Analysts on average had expected a profit of 25 cents and revenue of $647.8 million.

The company's shares were down 14.6 percent at $14.11 in after-hours trading.

Shares of San Francisco-based Fitbit, whose June debut was well received, had lost close to 70 percent since hitting a high in August. (Reporting by Sai Sachin R in Bengaluru)