Fitbit Inc (NYSE:FIT) stunned the market analysts by recording $10 million net profit for the third quarter 2018 after facing losses for months together. The company successfully managed to beat its $2.8 million loss a year earlier and a loss of $54.2 million in spring this year. As per the report, the company owes this incredible jump in its net earnings to the Versa and all the smartwatches in particular.
Fitbit’s smartwatches ratio goes up
Fitbit sold fewer devices as compared to last year. In 2017, the company sold 3.6 million smartwatches whereas this year it sold 3.5 million. Even then the ratio of smartwatches is up this year. It is because the company made more money from each sale even though the sale of smartwatches is comparatively less than the bygone years. The one device that made it big for Fitbit is Versa whose sales took the charge and outperformed other rivals including Samsung, Fossil Group Inc (NASDAQ:FOSL), and Garmin Ltd.(NASDAQ:GRMN) in the lower-cost watch market of the US.
Incidentally, Fitbit came a close second next to Apple Inc. (NASDAQ:AAPL) in America which is certainly a huge feat for a company that introduced the Iconic, its first watch almost 14 months ago. As of now, nothing can be said whether Fitbit will continue to gain or not. However, the $199 price structure and fitness focus of the Versa is really helping the company to tide over the competition. Even then, Fitbit spent a lot of amount of the Q3 to compete against its close rivals.
Fitbit faces stiff competition from Apple Watch Series 4
Apple launched its Apple Watch Series 4 just a few weeks prior to the end of last quarter. So, now Fitbit smartwatches have more competition to tackle. Apart from Series 4, Fitbit will also have to keep a close eye on regular rivals like Samsung. The Galaxy Watch from the South Korean electronics giant can be a big hit during a fierce, full holiday quarter.
Few reasons that led to Fitbit bouncing back in the competition include leaving the rough streaks behind that has been working negatively for the company and introduction of a right combination of price and features in the form of Fitbit Versa.