Once the top maker of smart, wearable devices, Fitbit has been struggling for the past year as the market for its fitness tracking gadgets appears to plateau. On Wednesday, the company set a date for the next version of its product, a smartwatch built from the seeds of another pioneering wearable maker that ran into difficulty, Pebble.
Fitbit CEO James Park says his company’s new smartwatch will be available in time for the holiday shopping season. “We’re excited for the launch,” Park says. “There’s a lot of attributes to it that differentiate us from the competition out there.”
The CEO isn’t ready to reveal exact specifics yet, though Fitbit says the upcoming device will have multi-day battery life, GPS tracking, water resistance, a focus primarily on health and fitness functions, and come at an “attractive” but still undisclosed price. That suggests it will cost in the range of Apple’s $269 to $369 entry-level watch models, as opposed to higher-end models at $549 and up or some of the newer luxury smartwatches that cost $1,000 plus and run Google’s (GOOGL) Android Wear software.
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The debut will come after Fitbit’s sales from its traditional fitness trackers have fallen significantly and Apple retooled its watch to target more health and fitness functions. On Wednesday, Fitbit said its second-quarter revenue had dropped 40% to just $353 million on sales of 3.4 million devices, a little more than half what it sold a year ago.
Earlier this year, Fitbit fell to third place overall for the first time in the wearables category, according to market tracker International Data Corp. Chinese gadget maker Xiaomi tied with Apple (AAPL) to ship the most wearables.
Still, the second quarter sales were a little better than Wall Street analysts expected and shares of Fitbit, which had lost 63% over the past year, gained about 5% in after-hours trading.
The upcoming Fitbit (FIT) smartwatch will run third-party apps, although it may take some time for a robust market to develop, Park said. At least initially, only a limited number of selected partners will be able to provide apps, Park says.
“That’s reflective with our overall company strategy—we’re a health and fitness-focused brand,” he says. “Our partner strategy and our app strategy will probably reflect that a little bit in the beginning.”
Fitbit will distribute a software developer kit to allow more companies to create compatible apps over time. “It will be really exciting and interesting to see how the developer community, primarily initially from Pebble, reacts to the tools,” Park says. “I think developers are going to be surprised and excited by the ease of use and simplicity of the developer tools.”
Fitbit built a technology foundation for its new device over the past year or so, paying a total of $54 million for assets from failing smartwatch makers Pebble and Vector, and mobile wallet startup Coin.