Fitbit Updates IPO Pricing as Apple Watch Gets Set for Retail Launch

NEW YORK (TheStreet) -- Fitness technology company Fitbit updated its IPO filing, announcing it intends to raise $358 million in its initial public offering as the company competes with the likes of Apple (AAPL), Jawbone and others in the space.

In a new filing on Tuesday, San Francisco-based Fitbit, led by CEO James Park, announced it is selling 22.38 million Class A shares in the initial public offering, slated to happen later this year. In addition, private shareholders in the company will sell 7.46 million Class A shares, bringing the total to 29.84 million shares being sold in the offering, at a proposed price of $14 to $16 each. At $16 a share, that would value Fitbit, at approximately $3.3 billion.

In 2014, the company ended the year with $745.4 million in revenue, generating net income of $131.8 million with adjusted EBITDA of $191 million. That's a significant improvement over 2013, when it earned $79 million on $271.1 million in revenue. In the first three months of 2015, Fitbit said it generated $336.8 million in revenue, with net income of $48 million and adjusted EBITDA of $93.4 million.

According to the NPD Group, which Fitbit cites in its filing, the company had a 85% market share in dollar terms of the U.S. connected activity tracker market in the first quarter of 2015.

With the Apple Watch already available for sale on the company's website and slated to be available in the company's retail stores later this month, there is some concern that Fitbit and other fitness trackers will be hit by the smartwatch, according to Mio CEO Liz Dickinson.

"Fitbit took it to new level by socialization and seeing steps, but there's nothing new though," Dickinson said in a recent phone interview. "The smart watch market is super new and exciting and it will cannibalize the pedometer. The fitness tracker market is in a precarious position and will be cannibalized."

Dickinson noted that the market for fitness technology is expected to be a $17 billion market by 2020.

Fitbit recently launched a number of new fitness trackers, including the Fitbit Charge, Fitbit Charge HR and the Fitbit Surge. In total, the company has seven devices -- Fitbit Zip, Fitbit One, Fitbit Flex, Fitbit Charge, Fitbit Charge HR, Fitbit Surge and Fitbit Aria, a "Wi-Fi connected scale that tracks weight, body fat percentage, and BMI.

(See TheStreet's review of the Fitbit Charge right here.)

In addition to updating the terms of the offering, which is being led by Morgan Stanley and Deutsche Bank among others, the company noted the lawsuit privately-held Jawbone is bringing against it.

On May 27, Jawbone filed a lawsuit against Fitbit and some of Fitbit's employees who were employed by Jawbone "alleging trade secret misappropriation, breach of contract, breach of the implied covenant of good faith and fair dealing, and unfair and unlawful business practices."

The case is being heard in the Superior Court of the State of California in the County of San Francisco.

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