Fitbit Plummets as Competition in Fitness Devices Heats Upby
Shares fall 18 percent to lowest price in almost seven months
Move follows the announcement of rival devices at CES
Fitbit Inc., the maker of wearable health-tracking devices, fell to the lowest price since its initial public offering after introducing a new smartwatch -- similar in design to Apple Inc.’s product -- while companies such as Fossil Group and Under Armour Inc. debuted fitness devices at the International Consumer Electronics Show.
Fitbit’s Blaze features on-screen workouts and a connected GPS, and was available Tuesday for pre-sale at $199.95. Meanwhile, Under Armour showcased a connected fitness system that includes a sport band, and products including a smart shoe and wireless headphones. Fossil also said it will introduce more than 100 wearable products in 2016.
Fitbit fell 18 percent to $24.30 at the close of trading in New York, the lowest price since its June 17 IPO at $20 a share. The San Francisco-based company has been the leading seller of wearables, though its market share fell to 22 percent in the third quarter of 2015 from 33 percent a year earlier, according to IDC.
Daniel Amir, an analyst at Ladenburg Thalmann & Co., said he expects to see more competition for Fitbit, because the technology required to create fitness devices isn’t novel. Amir said success in this category is more about design and brand.
“They are now competing head to head with Apple in the watch category and it will cannibalize their fitness tracking business,” Amir said.