Fitbit to lay off 6% of its staff after disappointing Q4 results
- Fitbit's preliminary financial results show its revenues totaled $572 million to $580 million in Q4 2016, which is significantly less than what the company expected to report – up to $750 million in revenues.
- Softer than anticipated holiday demand for trackers caused the slowdown, the company said, adding business remained strong in Europe, the Middle East, and Africa where it increased 58% during the quarter.
- The San Francisco-based wearable technologies firm will layoff approximately 6% of its global workforce (110 employees) to create "a more focused and efficient operating model" and it expects the reorganization to cost about $4 million.
Founder and CEO James Park said the recent acquisition of assets from Pebble, Vector Watch, and Coin will help spur long-term growth in the smartwatch space. He said Fitbit ended 2016 with 23.2 million active users.
While its financial results were disappointing, the company recently touted cost savings along with improved outcomes for two companies that use its corporate wellness program. Earlier this month, the company teamed up with UnitedHealthcare to boost participation in workplace wellness programs.
Yet a 2016 study published in JAMA Cardiology concluded Apple Watch bests other wearable wrist technologies, including Fitbit Charge HR and Mio Alpha, when it comes to how accurately they measure heart rates compared to an electrocardiogram.