Google’s Parent Company Aims to Buy Fitbit in a Bid to Enter the Wearable Market

Google’s Parent Company Aims to Buy Fitbit in a Bid to Enter the Wearable Market

Technology

On Monday, Fitbit stock had climbed by more than 30% after the arrival of procurement news. Reportedly, Alphabet, Google’s parent company, has revealed interest in purchasing Fitbit, the fitness tracking company. Meanwhile, both tech companies have refused to comment on the latest news. It seems like, Alphabet has made a bid of undisclosed size to buy the company best known for its wearable fitness trackers. The news had boosted Fitbit’s stock, as well as it has added more than $330 million to Fitbit’s market cap. Now it has a stock market capitalization of around $1.5 billion. Apart from this, Fitbit shares have heightened more than 12% for the current year.

For now, it is unclear that ho much Alphabet will offer to purchase Fitbit. Notably, the bid will make Alphabet a player in the wearable fitness tracking space. Even more, it would compete against the likes of Apple, which has recently launched a fresh version of its prominent smartwatch. Currently, Google permits its Wear operating system to companies like Fossil, but it does not produce its own smartwatch. Google has called its hardware policy as ambient computing, which means users can have access to its services from any corner of the world. Purchasing Fitbit could pave the way for Google services to cover a wider part of customers’ lives. Maybe, Google will measure up to Apple in the health and fitness industry. In the case of Fitbit, the acquisition will offer support from Alphabet along with a much-needed boost for the company.

On the other hand, the Alphabet has announced its third-quarter earnings. The latest report reveals the tech giant has missed earnings per expectation, but it has hit the target in other aspects. After the announcement of Q3 earnings, the company’s stock had experienced a dive as much as 4% in after-hours trading. Later, it had recovered and settled down for around 2%. Fitbit would not be the first agreement that Google would be conducting in the wearables space. Google also aims to buy the assets of Fossil Group Inc. It is a company that has announced that it will sell the property related to the smartwatch technology under development for $40 million.