Fitbit is laying off 6% of its staff, and its stock is tanking

Wearables industry leader Fitbit is in the midst of a reset.

Today the company shared its “preliminary” financial results for the fourth quarter, confirming plans to lay off a significant portion of its staff after selling fewer wearables than expected in 2016.

Fitbit says the “reorganization” will eliminate 110 jobs, or about six percent of the company’s workforce. Yesterday, the Information said Fitbit would cut between 5 and 10 percent of its staff in order to reduce costs.

In a press release announcing the layoffs, the health and fitness company blamed its 2016 results on subpar holiday sales — Black Friday’s in particular. The news sent Fitbit’s stock price down by about 12 percent this morning.

Fitbit recently acquired two smartwatch startups, Pebble and Vector, and these deals may be key to the company’s turnaround this year, if it’s able to pull one off. It certainly looks like Fitbit has a full-fledged smartwatch in the works for 2017.