Here's one to take with a grain of salt, simply because as of now it's not official. Sources at CNet say that most of the FuelBand team is to be let go, and that Nike will halt production of the hardware altogether. This includes the planned "slim" version to be released later this year, and everything else the 70-odd member team may have been working on.
Word of the plans also have reached the tech-industry anonymous network Secret.ly last week, where an anonymous poster said:
The douchebag execs at Nike are going to lay off a bunch of the eng team who developed The FuelBand, and other Nike+ stuff. Mostly because the execs committed gross negligence, wasted tons of money, and didn't know what they were doing
Interestingly enough, Nike just launched the Fuel Lab — a San Francisco-based think tank for testing connected devices. It's possible that Nike, who will release an API for it's software services, has plans to partner with another player or players to build hardware.
Now that the rumor is out in the open, we expect to hear more and will keep you updated.