Google’s parent company, Alphabet, offered to buy Fitbit, a source close to the case told CNBC on Monday. Reuters first announced that Alphabet had offered to buy Fitbit. Fitbit stock stopped after rising more than 18%.
Shares resumed operations and ended the day with a 30.5% increase, adding more than $ 330 million to its market capitalization to around $ 1.5 billion. Fitbit shares now rose more than 12% for 2019.
It is not clear how much Alphabet offered to buy Fitbit.
With this agreement, Alphabet would become a key player in the field of fitness monitoring, in competition with Apple, which recently launched a new version of its popular smart watch. Google licenses the use of its Wear operating system to companies such as Fossil, but currently does not manufacture its own smartwatch.
Google has called its hardware strategy “environmental computing,” meaning that users should be able to access their services wherever they are. The purchase of Fitbit could be a way to make Google services a more important part of customer life and compete with Apple in the field of health and fitness.
Last year, Google hired David Feinberg, former CEO of Geisinger Health, to consolidate its health care strategy. The company announced several new hardware products in early October, including the new Pixel 4 smartphone.
According to Fit Analytics, Alphabet’s support could boost the company, which saw Apple take approximately half of the global smartwatch market in 2018 in terms of units delivered.
In its publication of the July results, Fitbit lowered its guidance for the year, citing weaker than expected sales of its new lightweight watch.
Fitbit declined to comment. Alphabet did not respond to requests for comments. The Chief Financial Officer of Alphabet declined to comment on the possible acquisition of Fitbit in an interview after Alphabet published the results on Monday afternoon.
Subtly charming pop culture geek. Amateur analyst. Freelance tv buff. Coffee lover