Health IT

Fitbit files for $100M IPO as sales of its wearables rocket

Fitbit has filed for an initial public offering, riding strong sales of its devices and […]

Fitbit has filed for an initial public offering, riding strong sales of its devices and making it one of a handful of fitness tracker manufacturers to enter the public market. It will offer up to $100 million of common stock, but The Wall Street Journal noted that’s likely to change.

The company, which started in 2007, plans to trade on the New York Stock Exchange under the symbol FIT. The news confirmed what sources told Reuters five months ago.

Sales of the device soared to 10.9 million last year compared with 4.5 million in 2013, according to its S-1 filing. It recorded $745.4 million in revenue in 2014 compared with a little more than $271 million two years ago. Last year it made a profit of $131.7 million.

The only other dedicated wearable maker to go public in recent years that I could find in a cursory search is wearable camera maker GoPro, which made its public debut last year.

The Journal article took note of a risk factor highlighted in Fitbit’s filing that it’s in a highly competitive market. It has many competitors that produce wearables as part of their business such as Apple, Garmin, Microsoft. In addition to wearables, Fitbit also sells a WiFi connected scale.

One challenge for the company is how it will maintain its market prominence in an increasingly diverse wearables market. The article noted that the fitness wearables market “has shifted away from the early adopters, who tended to be fitness fanatics and ultimately found the devices too basic.”

The inconsistent data its trackers generate could limit its ambitions in healthcare, even as pilot studies, such as one by Biogen Idec and PatientsLikeMe focusing on MS patients, used Fitbits to track activity levels and sleep between doctor appointments.

It also suffered a setback last year when users of its Fitbit Force developed a rash. Even though it stopped selling it, the article noted that the problem has exposed it to litigation over the skin irritation that stemmed from the device.

 

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