Google Has Built an Provide to Purchase Fitbit – The Motley Fool

It’s time to kill off Dress in OS.

Studies very first surfaced a very little over a thirty day period back that Fitbit (NYSE:In good shape) was putting alone on the auction block, and it seems that the approach is transferring along. Although you can find a solid circumstance that Amazon.com would be a superior match to obtain Fitbit, Alphabet (NASDAQ:GOOG) (NASDAQ:GOOGL) subsidiary Google had been quickly named as a likely suitor, much too.

Will the lookup big conclude up pulling the set off?

2 Versa 2 smartwatches

Fitbit recently launched the Versa two. Impression supply: Fitbit.

An offer you is on the desk

Reuters stories that Google has formally built an present to scoop up the wearable tech company, sending Fitbit shares 31% increased by the shut. CNBC also corroborated the news. The experiences did not specify how significantly Google has set on the table, and the outlets’ resources be aware that talks could nonetheless tumble via and an acquisition could not materialize.

Fitbit has struggled in its pivot to smartwatches, with some products and solutions resonating with individuals though other people flop. For instance, the Versa Lite failed to fulfill sales expectations, ensuing in Fitbit chopping its comprehensive-12 months 2019 forecast in August. That news despatched shares to all-time lows, with Fitbit’s marketplace cap briefly dipping under $one billion for the initial time.

FIT Market Cap Chart

Suit Current market Cap info by YCharts.

Next the Versa Lite debacle, the organization introduced the Versa 2, and investors are awaiting indications from management on how that smartwatch is offering. Fitbit is set to report 3rd-quarter earnings on Nov. six.

Google wants to set Have on OS out of its distress

If Google ended up to go ahead with the acquisition, it would right away turn out to be the No. two player in the smartwatch current market behind Apple after years of flailing with Have on OS. Third-bash producers have mostly abandoned Google’s wearable platform in favor of proprietary running techniques like Samsung‘s Tizen, which powers the South Korean conglomerate’s Galaxy Look at.

A lot of had been expecting Google to unveil a Pixel Check out this year as aspect of its growing hardware portfolio, but that system was reportedly axed years back by components chief Rick Osterloh, which helps make Google’s $40 million purchase of smartwatch technological know-how from Fossil previously this calendar year all the additional perplexing. It can be however unclear what mental residence Google purchased from the accent maker, but some staff members had been element of that deal as nicely.

Buying Fitbit would necessarily mean that Google would have two disparate smartwatch platforms. Fitbit had assembled its system by cobbling collectively elements from Coin, Vector, and Pebble, three businesses it had acquired in excess of the decades. If Google acquires Fitbit, it ought to finally get rid of off Use OS when and for all and carry on developing on the progress that Fitbit has built with Fitbit OS.


Evan Niu, CFA owns shares of Apple. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Apple, and Fitbit. The Motley Fool has the following options: short January 2020 $155 calls on Apple and long January 2020 $150 calls on Apple and recommends the following options: long January 2020 $150 calls on Apple and short January 2020 $155 calls on Apple. The Motley Fool has a disclosure policy.

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