Fitbit announced when it reported its third-quarter results that it was expecting fourth-quarter revenue to grow by just 2% to 5% year over year. The stock tumbled on the news, adding to its losses for the year. CEO James Park admitted that growth was slower than expected:
Investors took that statement as a sign that the days of rapid growth are likely over for Fitbit.
Now what
Whether Fitbit is able to hit its guidance for the fourth quarter remains an open question. Reports of high levels of channel inventories for the Charge 2 and Flex 2 suggest that the devices aren't selling as well as the company expected. Fitbit's ability to get its current customers to upgrade will determine whether the company beats or falls short of expectations.
With Fitbit facing the possibility of slumping sales in 2017, the stock could continue to decline going forward. On the other hand, if Fitbit managed a better holiday season than expected, the beaten-down stock could soar. There's a lot of uncertainty surrounding the company right now, and we won't know more until Fitbit reports its results.
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Timothy Green has no position in any stocks mentioned. The Motley Fool owns shares of and recommends Fitbit. The Motley Fool has a disclosure policy .
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.
