After the call, Fitbit announced third quarter financial results, including revenue of $ 409.3 million, and earnings per share, using the conventional methods of accounting in the amount of $ 0.19. Adjusted earnings were $ 0.24 per share.

The results are noticeably stronger. Investors had expected the company to report far slimmer $ 0.10 per share is adjusted profit from revenues of only $ 350.97. Shares in the company, however, sharply reduced after-hours trading, from almost 9 percent at the time of writing.

What’s going on? Despite the devastating quarter, capital FitBit is getting beat on what, so far, TechCrunch can say at the current tip, planned liquidity for current shareholders, recently announced by placing additional shares, as well as the legal friction.

From a legal point, Jawbone and Fitbit has a legal and comes back with the latest news to be a counter-claim filed by the former. Fitbit has a pending patent infringement case on the books, but Jawbone denies all the accusations … With amusing word “frivolous”. Because everyone loves to go to court.

That’s what Jawbone had to say:

“Fitbit consciously and deliberately abusing its patents, as part of its efforts to protect its market power. And in this case, and in co-pending case in Delaware, Fitbit claims that jaw violates three of its patents. Violation of the approval of both lawsuits are manifestly meritless and Fitbit was not sufficient grounds for bringing any case. “

to answer FitBit:

“We have been able to compete successfully in the competitive market, giving consumers the products they want at the price they find attractive. These allegations are unfounded and another misleading attempt to advertise in order to distract attention from their own lack of Jawbone performance. The focus of FitBit is and continues to be on delivering innovative products and services that enable people around the world to achieve their health and fitness goals. ”

Time counter this is no accident, given the fact that revenue fell today.

relative to the point of liquidity is the key paragraph:

lockup

bunch of capital in first drew its way to the markets is a great way to reduce the price of shares in the short term. In fact, the action, which was still under lock and key will be put on sale. This means that employees can sell it. If they are in large numbers, it could reduce the price of the company shares. Or not, depending. Investors seem to vote with their sell buttons.

But that’s not all. Fitbit also intends to sell a bunch of new shares. Release put out in tandem with its earnings is that plain. Here are the verbiage:

lol

Investors are probably not thrilled with the idea, Fitbit necessary, or even wanting more money and, I believe, can not jump for joy at the implied dilution of their own revenues.

Summarizing, Fitbit smashed earnings expectations, increased its in-line guidance of $ 1.8 billion for the year, and ended the financial period from $ 575.5 million in cash. All that was not enough to balance the placement of additional shares. Perhaps that is why the box fuss, he did not intend to use this method of finance, as it works towards profitability.


Featured image: Antonio Garcia Morales / Flickr UNDER CC BY-SA 2.0 License