Fitbit revenue up 5% in Q3 2020 thanks to sales of new devices

Fitbit has posted a 5% year-on-year increase in revenue during Q3 2020, beating analysts forecasts. This was largely due to strong sales of devices introduced in recent months.

Revenue for the quarter totaled $365 million. International revenue increased by 20% during this period, more than offsetting the 6% fall in domestic revenue. US customers still account for a bulk of the total, though, capturing a 54% share in Q3.

Fitbit actually sold slightly fewer devices than it did a year ago (3.3 million versus 3.5 million), but the company has seen a third successive quarter of growth in sales. The release of Versa 3, Sense, Inspire 2 and Charge 4 at the start of the year have boosted sales.

The company says new devices accounted for 52% of revenue in Q3. The figure shows the importance of keeping the product line fresh.

In the three month period smartwatches represented about 60% of revenue, fitness bands 36% and software offerings 4%. The average selling price per device was $104, up 8% on last year. As smartwatches continue to increase share of devices sold, expect the average price to keep creeping up.

“The response to our new offerings has been strong across both devices and software,” said James Park Fitbit CEO.

“We achieved a key financial milestone this quarter with an annual run-rate for consumer services revenue of more than $100 million, highlighting the continued opportunity we have to deepen our relationship with users.”

Fitbit came out of Q3 beating expected revenue by nearly $65 million. This is good news for the company ahead of its much-anticipated $2.1 billion merger with Google. The deal is expected to conclude in the months ahead, pending regulatory approval.

The San Francisco outfit reported a GAAP net loss of $54 million and a non-GAAO free loss of $8 million. The GAAP net loss per share was $0.20 in Q3 and non-GAAP net loss per share was $0.03.

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