could you help me with the data in excel to answer question #1 using the information from exhibit 5 and 6
example on how it should look!!
1. Following the content and structure of the Performance Assessment Template, assess Fitbit's ability to CREATE value and their ability to CAPTURE value. Show your work and reference the data/your calculations to explain your conclusions. *Note that the only way to compare FitBit's growth is by using the unit shipments data given in Exhibit 4. Organize your memo to first describe your conclusions about their ability to create value and their ability to capture value. Reference the details of your data and calculations (in the table you will include after the write up). Then give your overall conclusion about the state of Fitbit's overall performance. After this, show your data/calculations in a table (like we had in the class example) Now, for the questions below, think about what your conclusions about their performance might mean about their strategic alignment. Use information from the case as appropriate, try to identify what might be CAUSING the performance. Don't try to solve anything yet...no recommendations...just look for hints of what seems to explain why Fitbit's performance is where it is. 2. What do you think explains your assessment of their ability to CREATE value? 3. What do you think explains your assessment of their ability to CAPTURE value? 276 Part 2 Cases in Crafting and Executing Strategy tock could fall another wally the market tracker) is head hing FIT can do Btion. Chowdry coes Ins.. Fitbit does not have a of generating income as depreciation, and amortization) to range from 100 million to $480 million for the 2016 fiscal year. The projections were based on Fitbit's stellar Fiscal year when annual revenue increased to $1.00 billion from $745 million in 2014 and net earnings increased to $175.7 million from $131.8 million in 2014 however, 2016 proved to become a much more trou- bing year than managment expected. The company's 2016 revenues failed to meet expectations, it recorded a loss of $102.8 million and adiusted EBITDA fell from $389.9 million in 2015 to $300 million in 2016. The company's declining financial performance continued during the first quarter of 2017 with its net loss exceeding $60 million for the three month period ending April 17. 2017. Exhibit 5 presents Fitbit's consolidated statements of operations for 2014 through the first quarter of 2017. The company's condensed consolidated balance sheets for 2015 and 2016 are presented in Exhibit 6. Suppested that he believed the stock could fall 50 percent and speculated. Gradually the for single-purpose devices (Fitness tracker) ing toward zero, and there is nothing FIT to reverse the trend. In addition, Chowdry mented that unlike Apple, Inc., Fitbit does not ha group of developers or a way of generating in Apple does. Even though the Fitbit tracker Dresde were much cheaper than Apples ($129 as Com as compared to $349 for the cheapest Apple Watch Sport) had an inventory of more products than Fitbit ity tracking is just a feature used by Fitbit, and the feature was being used in many other devices by variety of companies. Leerink analysts were cautious about projections for sales increases at Fitbit and suggested a tarot price to buy the stock of $18. The analysts suggested that ongoing sales would likely remain sluggish after initial increases related retailer inventory needs for new products were satisfied." Analysts' Assessments Analysts were becoming concerned about Fitbit's long-term viability as early as February 2016 when its share price declined by 20 percent by monthend. An analyst with Global Equities Research, Trip Chowdry. Fitbit's Strategic Inflection Point Going into mid-2017, James Park and Eric Friedman were confronted with how best to bolster Fitbit's EXHIBIT 5 Fitbit, Inc. Consolidated Statements of Operations, 2014-First Quarter 2017 (in thousands First Quarter 2017 2016 2015 2014 $298.942 180.643 118,299 $2.169.461 1.323.557 845.884 $1,857,998 956,935 901,063 $745,433 387.776 357.657 87.785 91,174 30.746 Revenue Cost of revenue Gross profit Operating expenses: Research and development Sales and marketing General and administrative Change in contingent consideration Total operating expenses Operating income Interest income (expense), net Other expense, net Income before income taxes Income tax expense Net income 320.191 491.255 146,903 54,167 112,005 33,556 209.678 191,379) 1.096 533 89.750 29,671) $ 160,079 958.349 (112.465) 3,156 150,035 332,741 77.793 (7.704) 552,865 348.198 (1.019) (59,230) 287,949 _112,272 14 (109.295) - 16518) $(102,777) 199,728 157,929 2.222) (15.934 139.773 7.996 $131,777 Source: US Securities and Exchange Commission Form BK.FR change Com $ 175,677 f or t er ca 2015 Form 10-K for 2016 Form 10- Qwer 2017. A Fitbit, Inc., in 2017: Can It Revive Its Strategy and Deve l osies 277 densed Consolidated Balance Sheets, 2015-2016 Inc., Condens Il another ac market is head. I can do dry com- ot have a come as Oroducts December 31, 2016 December 31, 2015 and cash equivalents le securities recevable.net mpared . Apple 1. Activ nd this es by a penses & other current assets ocument assets and equipment, net $ 301,320 404.693 477,825 230,387 66,346 1,480,571 75.553 51,036 27,521 174,097 10.448 $1,820.226 $ 535 846 128,632 469.200 178,146 43,530 1.355 414 44.501 22.157 12,216 83 020 1,758 $1,519,066 ble assets, net Deed tax assets Theresets ections target gested after als for pint Iman bit's Gabilities, Redeemable Convertible Preferred Sack and Stockholders' Equity Gretabilities counts payable Aired abilities Deferred revenue home taves payable el c ent liabilities Oberlabilities $313.773 390,561 49,904 7,694 761,932 59.762 821,694 $ 260,842 200,099 44,448 2.868 508 257 29.358 537,615 Solders' equity Canton stock & pald-in capital Iccumulated other comprehensive income lained earnings Sed sodholders' equity 859,368 1978) 140.142 998,532 $1,820.226 737,841 691 242.919 981451 $1.519,056 Total abilities and stockholders' equity 2016 10 det standing and ody deteriorating common comment tended to be mor tany other devices ading and turn around the company's ang linancial performance. It was ament among analysts that Fitbit more than a one-product company. Ce the activity trao ctivity tracking feature was being used in devices by a variety of companies, Fitbit of new uses of the tracker as well as new ne journalist suggested, "Standalone fit- After all, Park had recently commented, "The next big leap will come when we lie into more detailed clini cal research and create devices that can make light weight medical diagnoses. You look at blood glucose meters today, I wouldn't necessarily say that those are the most attractive or consumer-friendly devices would say consumer-focused companies, whether it's us or Apple. probably have an inherent advantage in the future. One possibility for the company w to become a platform-rather than just a product to think of a bites. As one jou wackers are iPods in a worl Fods in a world that's moving to Calculate: fill in the blanks... 1317 (Millions) Tends 2015 REVENUE 13604 1360 Growth rate 3.3% Cost of Goods Sold 975 Gross profit 1 385 Gross Profit Margin 28.3% Operating Expenses 343 Operating Profit [ 42 Operating Profit Margin 3.1 % Net Profit 24 Total Assets 516 Return on Assets [4.65 1317 - 1264-1 INDUSTRY 2014 2013 AVERAGE 1317 1264- 4,2% 5.74% growth 931 896 386 368] 29,3% 291) 35.10% 341 327 43 41 3.49 3.270 742118 12.30% 27 26 550 524 4.91 4.94 10.40%
