Fitbit sells more devices in Q4.2019 vs Q4.2018 but make less profit and less revenue. That’s the only vaguely positive take on a dismal holiday season performance.
Oh dear! I guess it’s no surprise and it’s no surprise either that the market was not surprised, with the share price remaining broadly unchanged.
A $15m Q4.2018 profit was transformed into a whopping $120.8m loss in Q4.2019. I could waffle on a bit but the bottom line is that Fitbit’s strategy to shift more devices at cheaper prices worked. It just didn’t work PROFITABLY. Senior management clearly saw this coming and that’s why they agreed to sell to Google. Another slant is that all the bad news is brought forward by putting every worst-case scenario into the Q4 period’s books. We shall see if that is true in 3 month’s time when the next results are out.
In detail, here are the numbers:
|
In millions, except percentages and per share amounts |
|
December 31, |
|
December 31, |
|
December 31, |
|
December 31, |
||||||||
|
GAAP Results |
|
|
|
|
|
|
|
|
||||||||
|
Revenue |
|
$ |
502.1 |
|
|
$ |
571.2 |
|
|
$ |
1,434.8 |
|
|
$ |
1,512.0 |
|
|
Gross Margin |
|
24.3 |
% |
|
38.0 |
% |
|
29.8 |
% |
|
39.9 |
% |
||||
|
Net Income (Loss) |
|
$ |
(120.8 |
) |
|
$ |
15.4 |
|
|
$ |
(320.7 |
) |
|
$ |
(185.8 |
) |
|
Net Income (Loss) Per Share |
|
$ |
(0.46 |
) |
|
$ |
0.06 |
|
|
$ |
(1.25 |
) |
|
$ |
(0.76 |
) |
|
Non-GAAP Results |
|
|
|
|
|
|
|
|
||||||||
|
Gross Margin |
|
26.3 |
% |
|
38.7 |
% |
|
31.2 |
% |
|
40.9 |
% |
||||
|
Net Income (Loss) |
|
$ |
(31.5 |
) |
|
$ |
36.3 |
|
|
$ |
(132.0 |
) |
|
$ |
(48.8 |
) |
|
Net Income (Loss) Per Share |
|
$ |
(0.12 |
) |
|
$ |
0.14 |
|
|
$ |
(0.51 |
) |
|
$ |
(0.20 |
) |
|
Adjusted EBITDA |
|
$ |
(34.9 |
) |
|
$ |
49.6 |
|
|
$ |
(128.3 |
) |
|
$ |
(31.4 |
) |
|
Devices Sold |
|
6.0 |
|
|
5.6 |
|
|
16.0 |
|
|
13.9 |
|
||||
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“Fitbit sell more devices in Q4.2019 vs Q4.2019 but make less profit and less revenue”
I am not a marketing specialist but 100% certain that the delta is zero. (typo alert)