Google has just announced that it has acquired the San Francisco based Fitbit in a $2.1 billion deal that will enable the tech giant to compete with Apple in the fast growing smart-watch industry. The company said its buying Fitbit to bring together “the best AI software & hardware” in order to spur innovation in smart watches.
The tech giant is paying $7.35 per share, that’s a premium of more than 70% to the last traded share price. Fitbit was founded in 2007, The company has gained attention due to its rapid growth & success. It’s revenue increased from around $5 million to more than $1.8 billion dollars. Fitbit has around 29 million active users worldwide & has sold 100 million plus devices since 2007.
The wearables market is still highly competitive. Apple, Samsung, Xiaomi, Garmin, Huawei are the leading competitors. Forecasts suggest that number of wearable e-devices will reach 220 million units in 2019.
The Fitbit acquisition is not the only recent investment Google made into health focused devices; the company spent $40 million to acquire hybrid smartwatch technology from Fossil earlier this year. “The tech reportedly combines analog & digital features for smartwatches.
Fitbit Co-founder & CEO James Park commented “With Google’s resources & global platform, Fitbit will be able to accelerate innovation in the wearables category, scale faster and make health even more accessible to everyone.” Fitbit said it takes privacy very seriously & pledged that customer’s data would not be used by Google ads.