Smartwatch maker Fitbit Inc. (NYSE: FIT) posted another terrible quarter and, once again, asked investors to look toward the future for a turnaround. The numbers were just better than expectations, so the stock inched up, but not enough to be noticeable. Shares are still down nearly 60% in the past two years.
Fitbit’s revenue dropped again, down from $353 million in the June quarter of last year to $299 million in the most recent one. The company had a net loss of $54 million, compared to $19 million a year ago. Fitbit sold 3.4 million devices in the second quarter last year. That dropped to 2.7 million.
Fitbit management promoted several pieces of what it called good news. Among these were that six devices introduced in the past year represented 59% of revenue. That means older products lost their appeal and created only a small foundation for future sales. Fitbit management also said its products outsold Samsung, Fossil and Garmin smartwatches in the second quarter within North America. It is a comparison that lacks solid numbers and context.
To make matters worse, Fitbit management said it expected another revenue decline in the third quarter, albeit only 3%.
As part of the announcement, James Park, co-founder and CEO, said:
Our performance in Q2 represents the sixth consecutive quarter that we have delivered on our financial commitments, made important progress in transforming our business, and continued to adapt to the changing wearables market. Demand for Versa, our first ‘mass-appeal’ smartwatch, is very strong. Within the second quarter, Versa outsold Samsung, Garmin and Fossil smartwatches combined in North America, improving our position with retailers, solidifying shelf space for the Fitbit brand and providing a halo effect to our other product offerings.
These financial commitments have been so weak that few investors would want them. Park will have to do much better.
Shares of Fitbit traded down about 5% early Thursday to $5.62, with a consensus analyst price target of $6.10 and a 52-week trading range of $4.51 to $7.79.