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Fitbit Inc. shares are down 15% in premarket trading after the digital health and fitness company was downgraded to hold from buy at Stifel based on analyst belief that a new operating model is risky. The price target is $35. “In a departure from objectives communicated since prior the IPO, Fitbit is specifically planning operating deleverage in fiscal year 2016,” analysts wrote in a Tuesday note. Investments in digital health strategies won’t drive revenue until 2017 “at the earliest,” the note said. The increased research and development spend is viewed as a risk based on unpredictable revenue growth. Fitbit gave weak guidance during its earnings announcement on Monday, warning that new products would weigh on results in the current quarter. Fitbit shares are down 44.2% for the year so far while the S&P 500 is down 4.8% for the same period.

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The pound continued to decline Tuesday, weighed by the prospect that U.K. voters may support a U.K. exit from the European Union. Sterling fell 0.4% to $1.4099, according to FactSet. The British currency on Monday fell by the most since 2009 after London Mayor Boris Johnson backed efforts to break away from the EU. On Tuesday, Bank of England Governor Mark Carney told lawmakers there’s been a pickup in buying of options aimed at protecting against future declines in sterling. Investors are facing a June 23 referendum date. On Monday night, more than one-third of companies listed on the U.K.’s FTSE 100 index voiced their support for the U.K.’s continued membership in the EU.

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Toll Brothers Inc. on Tuesday reported first-quarter net income of $73.2 million, or 40 cents a share. That was down from its year-ago result of $81.3 million, or 44 cents a share, and the result matched the 40 cents expected by analysts surveyed by FactSet. Revenue was $929 million, up from $853 million a year ago and above the consensus forecast of $915 million. The homebuilder also said Bruce E. Toll, vice chairman of its board of directors, has chosen to retire from the board, effective March 8. Shares were inactive in premarket trading.

Market Pulse Stories are Rapid-fire, short news bursts on stocks and markets as they move. Visit MarketWatch.com for more information on this news.

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Microsoft Corp. co-founder Bill Gates said technology companies such as Apple Inc. should aid law enforcement in specific cases involving terrorism. The comments, made by Gates during an interview with the Financial Times that published Tuesday, are a departure from the wide support the iPhone maker has seen from both industries and consumers in its standoff with the Federal Bureau of Investigation. Gates dismissed the idea that the government’s request for a “back door” to open one of the San Bernardino shooter’s iPhones would set a wide precedent. “This is a specific case where the government is asking for access to information. They are not asking for some general thing, they are asking for a particular case,” he said. He said it was no different from a situation where officials would need information from a phone company or a bank.

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A production freeze agreed upon last week by key oil-producing nations is a “first step,” and crude heavyweights could “take other steps in the future,” said OPEC’s Abdalla Salem El-Badri on Monday, according to media reports. El-Badri, secretary general of the Organization of Petroleum Exporting Countries, said at an energy conference in Houston that the freeze should be evaluated after three to four months to see if it succeeds, according to a CNBC report. He declined to elaborate on what he meant by next steps, a Financial Times report said. El-Badri noted that Iran and Iraq, whose agreement to the freeze is key to its happening, “will come back later” with their response to it.

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