Fitbit stock has made a 10 percent jump following the company’s latest earnings report in which, the company appears to have beaten Wall Street expectations. True, it did report losses however, the losses stood at 15 cents per share as compared to the 18 cents per share that was being predicted by analysts.
The net revenue also managed to beat analyst expectations and stood at $299 million as opposed to the $280.8 million as predicted by analysts. The company reported that it had sold 3 million devices in the first quarter of 2017.
Interestingly, 36 percent of these sales came from customers purchasing their second Fitbit device. This suggests that the company is succeeding in making repeat customers out of people.
Commenting about the report, co-founder and CEO James Park said:
In the ten years since Fitbit was founded, we have transformed the wearables category with more than 63 million devices sold, over 50 million registered device users, and a global retail footprint of more than 55,000 stores.
Underlying consumer demand has been better than our reported results in North America as we work down channel inventory levels, giving us increased confidence that we will enter the second half of 2017 with a relatively clean channel. While 2017 remains a transition year, we have executed on our restructuring plan and are focused on positioning the company for the next stage of growth within wearables and connected health.
Fitbit stands at a very critical juncture at present. The company has made a slew of acquisitions including Pebble and Vector. It now needs to get a good product out into the market, specially since it appears to be of a mind to venture into smartwatches at a time when other companies are retreating from the niche.
There have also been reports that Fitbit’s next product is kind of unappealing and plagued with issues, but this good quarter may have given the company some breathing space as it rushes to fix them quickly. You can read the full report, including guidance for the year, right here.