Fitbit sales are slowing despite new products

The Charge 2 and Flex 2 didn't do enough for the company's bottom line.

REUTERS/Brendan McDermid

A sign that the market for fitness trackers might be reaching its saturation point, or at least losing a little bit of its steam: Fitbit's stock price fell hard, dropping by 30 percent today after the company announced it was about $3 million short of its third quarter revenue goals. While Fitbit did experience some revenue growth over the quarter, its net income was around $26 million, compared to $46 million for the same period last year.

Fitbit debuted two new devices -- the Charge 2 and the Flex 2 -- during the third quarter and launched a new partnership with Kohl's and Vera Wang. But even counting new corporate customers, Fitbit only saw an 11 percent growth in unit sales numbers and the product refresh didn't move as many units the company would have liked.

"I am pleased to see positive reception for our new products launched in the third quarter," CEO James Park said in a statement. "We continue to grow and are profitable, however not at the pace previously expected."

While the development of those new products and a legal battle with Jawbone could also be driving up operating costs, looking forward into the holiday season, Park says the company will re-focus on "improving the utility of our products and integrating more deeply into the healthcare ecosystem" while leveraging the brand for some new areas of growth.