Fitbit and the National Institutes of Health (NIH) are announcing a digital health research initiative that aims to uncover how certain health indicators relate to health outcomes. Tied to Fitbit's Bring-Your-Own-Device project and the All of Us research program, the joint initiative will invite current Fitbit users to sync their accounts and data to help researchers build out a massive data set for what's being called one of the world's largest precision medicine studies. Fitbit users will share health indicators such as physical activity, heart rate, and sleep patterns, along with details on their weight, water intake and meals. Researchers will then have access to the data to conduct a wide range of studies. According to Eric Dishman, director of the All of Us Research Program, digital technologies like Fitbit are key to enabling researchers to collect real-world, real-time data.
Fitbit turned a third quarter non-GAAP profit as smartwatch revenue now consists of 49 percent of sales, its healthcare business gains momentum and Europe, Middle East and Africa (EMEA) delivers growth. The company remains a work in progress, but CEO James Park noted that Fitbit is keeping its focus as it transforms its business. Much of Fitbit's transformation depends on using its platform to impact health outcomes. The company reported a net loss of $2.1 million, or a penny a share, on revenue of $393.6 million, up from $392.5 million a year ago. Non-GAAP earnings were $10 million, or 4 cents a share.
James T. Green thought he was having a panic attack. He took a break from work to walk around the block during a stressful day, and noticed he felt out of breath strolling up a slight incline. This isn't normal, Green thought. He had become an avid cycler in recent months and wasn't exactly out of shape. He sat down at his desk, and looked at the Apple Watch on his wrist. His heart rate was through the roof, and the HeartWatch app he was using to check his pulse was flashing warnings. Maybe it was something more serious, he thought.
Fitbit started life in 2007, with its founders touting a circuit board in a box as a way to lure investors. After selling its vision to consumers -- it managed to convince 5,000 people to pre-order the first version of its fitness tracker -- and venture capitalists, it began selling devices in 2009. By 2015, it went public with a multibillion dollar IPO, and by 2016, one in two fitness trackers sold were Fitbits. But by 2017, sales started to fall off, as consumers shifted to fully-featured smartwatches rather than lower-tech fitness bands and its revenue and stock price began to tumble. Its sales were eventually surpassed by Apple's, which was able to sell more wearables despite devices prices that were often over $100 more than Fibit's.
Healthcare is driving the next wave of growth in the smartwatch market, according to the latest data from IDC. The research firm posits that the two largest smartwatch brands, Apple and Fitbit, are focusing on the healthcare space as a way up the value proposition from basic wearables. "The healthcare market is quickly becoming the next frontier for wearables brands to conquer," said IDC analyst Jitesh Ubrani. "With heavy regulation and greater scrutiny, this segment will likely be the one that staves off value brands, allowing the market leaders to further cement their lead." Both Apple and Fitbit have clear ambitions to expand in the healthcare space.