Sales Of Fitbit Versa Lite Were Not Up To Expectation

Har Devarukhkar - Oct 04, 2019

The sales of Fitbit smartwatch were lower than expected, causing the drop in the company’s yearly revenue, which prompts a change in strategy.

The expected recovery of Fitbit by selling smartwatch has been reported to tumble. A report by the wearable manufacturer stated that the revenue of their smartwatch products has dropped by 27 percent in the second quarter of this year due to the “weaker than expected” sales of Versa Lite. Even though comparing to last year’s revenue, the company has lost less this year with only $68.5 million as opposed to $118.3 million, there is no doubt that the company had been expecting Versa Lite to help raise the bottom line more than this.

Fitbit Versa Lite, a smartwatch for people with a tight budget, comes in different colors.

This deficiency has made Fitbit to heavily rely on its fitness trackers once again. Around 68 percent of the company’s total income has been accounted for products introduced last year, in which the only one fell under the smartwatch category (Versa Lite). And as the revenue did not increase, it has become a problem. In order to attribute $14.3 million more to the final revenue, the company had around 31 percent devices more to sell, equivalent to the total number of 3.5 million. As a result, the outlook of Fitbit has been looking fairly gloomy due to the fact that its revenue this year is expected to be $50 million lesser than previous years.

Another important thing is that this shortcoming has urged Fitbit to change its strategy. The company reported that it would switch the introductions of a product “back to innovation from value”. In the newly developed strategy, Fitbit would refrain from pursuing inexpensive hardware (such as Versa Lite) too aggressively as it did before.

Fitbit’s smartwatch has been expected to help raise the overall profit but instead been a disappointment.

Nevertheless, the current situation of Fitbit is already expected from the get-go. Officially, the Versa Lite only costs $40 lower than its regular version, however, with many useful features removed such as WiFi, local music storage, gyroscope, and altimeter. As the regular version of Versa is fairly low-priced, which is only at $199, it would not make any sense to get the Lite if there is no discount offered. Because of that, many people have already thought that it would be more appropriate to just purchase a fitness tracker while keeping the extra money for something else.