Shares of Fitbit (NYSE: FIT) plummet over 9 percent after retail checks have shown the company’s latest wearable device, Charge 2, is off to a very sluggish start. Also, health insurer Aetna’s (NYSE: AET) deal with Apple (NASDAQ: AAPL) to reimburse policyholders for the purchase of their iWatch points danger for Fitbit. Aetna covers about 23 million people in the United States and the decision to give customers and employees’ discounts on the watch could help Apple’s sales of wearable devices.
“We continue to believe that a large portion of Fitbit owners stop using the device within months, which is a fundamental issue driving high churn that will make growth more challenging,” Pacific Crest Securities analyst Brad Erickson said in a note.
Fitbit also continues to face questions about the usefulness of its products, which track activity, such as steps taken, exercise and calories burned. Higher-end models track heart rate. Preorders for the $150 wrist tracker started in August, but the device has been hit with mixed reviews. Gizmodo called it the “the best fitness tracker, period,” but The Verge said it was “plagued with bugs”.