Fitbit shares tumbled by 11.2 percent after the company posted weak results for the fourth quarter and the full year, while predicting lower-than-expected sales from newly launched products such as the Ionic and Alta HR in the first quarter.

Fitbit's first smartwatch, the Ionic, arrived at the end of last year, with the company claiming that the new device delivers a combination of features that consumers have not yet seen in a smartwatch at an attractive price. It includes a health and fitness first focus, cross-platform compatibility, water resistance up to 50 meters, GPS tracking, and an easy-to-use software developer kit. The battery lasts up to five days.

But the new device has not met expectations in terms of sales. The management said on Feb. 26 that sales of its smartwatch took a hit from stiff competition as it was not a “mass appeal watch.”

For the first quarter of 2018, the company said it expects “limited revenues” from new product introductions, with total revenues of $240 million to $255 million. Wall Street anticipated revenues of $340 million.

For the fourth quarter of 2017, the company reported a sales decline of 0.5 percent to $570.8 million, weighed down by a 17 percent drop in sales of its fitness trackers. The company's net loss narrowed to $45.5 million, as compared to $146.3 million for the fourth quarter of 2016.

The management said that Fitbit's growth was affected by a product lineup that was skewed toward connected health and fitness trackers versus the faster-growing smartwatch segment. It sold 5.4 million wearable devices. New devices, namely Fitbit Ionic, Alta HR and Fitbit Aria 2 and accessory Fitbit Flyer, represented 36 percent of the revenues.

While sales decreased by 13.4 percent to $330.2 million in the U.S. they improved by 39.7 percent to $46.6 million in the rest of the Americas. Sales in Europe, the Middle East and Africa (EMEA) grew by 15.7 percent to $155.1 million and sales in Asia-Pacific jumped by 55.9 percent to $24.8 million.

Fitbit's gross margin soared by 21.5 percentage points to 43.6 percent, due to a favorable comparison base with the fourth quarter of 2016, when the margin was affected by the write-down of tooling equipment and components of $78 million, on top of increased rebates, returns and warranty reserves.

For the full year, revenues fell by 25.5 percent to $1.6 million. Sales from grew by 11 percent to $168 million, representing 10 percent of revenue. Some 37 percent of all activations came from repeat customers, and 41 percent of them had been inactive during a prior period.

Revenues from EMEA grew by 13 percent to $440 million, Other Americas sales gained 6 percent to $116 million, APAC sales decreased by 12 percent to $115 million, and U.S. revenues dropped by 39 percent to $944 million.

Overall, Fitbit's gross margin jumped by 3.8 percentage points to 42.8 percent. The company's net loss widened to $277.2 million from $102.7 million in the previous year.

Fitbit said it would launch more smartwatches to speed up the shift away from fitness trackers. It also reiterated its push into subscription services and other offerings to ensure a steady stream of revenues.