Competition in the growing wearables market is heating up...
Health-tech firm Fitbit has hit on hard times, it's been forced to cut some 6% of its workforce (110 people) as its latest results revealed "softer-than-expected" demand for its products.
The company warned that fourth quarter earnings were more than 20% lower than signaled in November - it will incur a net loss per share for its fourth quarter
This provoked a 16% drop in the value of its shares as investors worried about the future of the firm which has established itself as the leader in the first wave of wearable smart fitness products.
On the positive side, Fitbit’s sales were nearly 60% higher in the quarter across Europe, the Middle East and Africa while demand lagged in the more mature US market during the crucial holiday quarter. It notes that Black Friday sales were particularly disappointing.
The tech company said the job cuts will help it to create a "more focused and efficient operating model" - it has set aside $4m for re-organising costs during the first quarter of 2017.
James Park, Fitbit co-founder and CEO said, "Fourth quarter results are expected to be below our prior guidance range; however, we are confident this performance is not reflective of the value of our brand, market-leading platform, and company’s long-term potential."
"As the overall wearable category leader, we exited the year with an engaged community of over 23.2 million active users, making us uniquely positioned to be the partner of choice for the healthcare ecosystem, which is a key component of our long-term strategy," he continued.