Fitbit Shares Tank 14% On Weak Outlook

(RTTNews) - Shares of Fitbit Inc. (FIT) tanked 14% on extended traded Wednesday after the smart-wearables maker issued a weak outlook for the current quarter and lowered its full year guidance due to weak Versa Lite sales.

Second-quarter net loss was $68.5 million or $0.27 per share, narrower than last year's loss of $118.3 million or $0.49 per share.

Adjusted loss for the quarter was $35.8 million or $0.14 per share, compared with last year's loss of $54.2 million or $0.22 per share. Analysts polled by Thomson Reuters estimated loss of $0.18 per share last year.

Revenues for the quarter rose 5% to $313.6 million from $299.3 million last year. Analysts had a consensus revenue estimate of $311.98 million for the quarter.

Devices sold increased 31% year-over-year to 3.5 million. Average selling price decreased 19% year-over-year to $86 per device due to the introduction of more affordable devices.

U.S. revenue represented 58% of total revenue or $181 million, down 1% year-over-year, while international revenue represented 42% of total revenue and grew 14% to $133 million.

Looking forward to the third quarter, Fitbit expects revenues of $335 million to $355 million and basic loss per share of $0.11 to $0.09. Analysts currently estimate earnings of $0.02 per share and revenues of $399.4 million for the quarter.

For the full year 2019, the company lowered its revenue guidance to $1.43 billion to $1.48 billion from previous estimate of $1.455 billion from $1.550 billion. Fitbit expects basic loss per share of $0.38 to $0.31 for 2019. Analysts currently estimate loss per share of $0.15 and revenues of $1.56 billion.

The company said it lowered its outlook due to weaker Versa Lite sales.

"While we are disappointed to lower guidance for the year, we remain confident in our long-term transformation strategy and have demonstrated good results across key areas of the business. We saw growth in devices sold, increased active users and continued growth in our Fitbit Health Solutions channel, up 42% in the first half of 2019," said James Park, co-founder and CEO.

FIT closed Wednesday's trading at $4.20, down $0.13 or 3.00%, on the NYSE. The stock further dropped $0.59 or 14.05% in the after-hours trade.