Fitbit stock is having the worst day in the past three years after Fitbit Inc (NYSE:FIT) trimmed its third-quarter and full-year earnings forecast.
The maker of wearable devices, Fitbit, has been fluctuating for most of the year so far due to disappointing sales, and its poor show in Q2 2019 further piled on the pressure on the company. Despite the fact that the company managed to beat analysts’ estimates, Fitbit reduced its projections for the third quarter. In Q2 2019, the company generated revenues of $314 million as opposed to analysts’ estimates of $312 million. On the other hand, net loss per share stood at 14 cents for the quarter as opposed to estimates of 18 cents.
However, it is the company’s decision to cut its projections for the third quarter that sent Fitbit stock tumbling by as much as 16%, and at one point the stock touched a record low.
Back in March, the company launched the Versa Lite, which sold for $160 as opposed to the original device price point of $200. However, the company stated that the sales were disappointing, which is why it decided to curtain its projections for the next quarter.
Fitbit stock tumbled 19% at $3.42 and made an all-time low of $3.27 earlier in the session.
Due to the poor sales, Fitbit stated its new guidance for Q3 2019 revenues is $1.445 billion, compared to the previous projection of $1.550 billion. This reflects a hefty drop of $95 million.
The revenues projections for the third quarter have been pegged within the range of $335 million and $355 million. If it manages to hit those targets, then it would reflect a year-on-year decline in the range of 10% to 15%.
The company that started off as one of the innovators in this particular space is now facing an existential crisis as it tries to wade off competition. The day before, Apple (NASDAQ:AAPL) stated that its wearable device sales had soared to record levels.
Fitbit stock is one of the worst performers this year with a slump of 40%.
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