×
You will be redirected back to your article in seconds

Google to Acquire Fitbit in $2.1 Billion Deal; Smartwatch Maker Vows to Protect User Privacy

Google is expanding its device portfolio into smartwatches, reaching an agreement to acquire Fitbit in a deal worth $2.1 billion.

In announcing the agreement, Fitbit pointedly promised customers that it would strenuously protect their privacy. “Strong privacy and security guidelines have been part of Fitbit’s DNA since day one, and this will not change,” the company said. “Fitbit will continue to put users in control of their data and will remain transparent about the data it collects and why.”

Specifically, according to Fitbit, health and wellness data collected from users’ smartwatches and other devices will not be used to help target Google ads, the company said. In addition, Fitbit pledged to continue to remain “platform agnostic” with support for both Google’s Android and Apple’s iOS.

Fitbit’s stock popped 17% when trading opened Friday, at $7.25 per share. Google is proposing to buy Fitbit in an all-cash deal for $7.35 per share.

A pioneering wearable devices company founded in 2007, Fitbit competes with companies including Apple (which sells the Apple Watch line), Samsung and Garmin. Fitbit’s implied valuation of $2.1 billion with the Google is less than one-fifth its peak market cap of over $10 billion after it went public in June 2015.

The deal for Fitbit fills the wearables gap in Google’s device lineup. “A key long-term secular theme for tech platforms will be the digitalization (via smart mobile devices) of health/fitness/wellness,” UBS Securities analyst Eric Sheridan wrote in a research note Friday. “Prior to this transaction, we saw Google as having relatively low exposure to this theme.”

For Alphabet, Google’s parent company, the $2.1 billion Fitbit deal is a blip on its balance sheet — representing about 1.7% of Alphabet’s cash balance as of Sept. 30, 2019. Facebook also had been in talks to acquire Fitbit but was offering to pay only half of Google’s purchase price, The Information reported, citing anonymous sources.

San Francisco-based Fitbit uses data to deliver personalized guidance and coaching to users. The company says it has sold more than 100 million devices worldwide to date.

“We have built a trusted brand that supports more than 28 million active users around the globe who rely on our products to live a healthier, more active life,” Fitbit co-founder and CEO James Park said in a statement. “Google is an ideal partner to advance our mission. With Google’s resources and global platform, Fitbit will be able to accelerate innovation in the wearables category, scale faster, and make health even more accessible to everyone. I could not be more excited for what lies ahead.”

Google is “looking forward to working with the incredible talent at Fitbit, and bringing together the best hardware, software and [artificial intelligence], to build wearables to help even more people around the world,” said Rick Osterloh, senior VP of devices and services at the internet giant. “Fitbit has been a true pioneer in the industry and has created terrific products, experiences and a vibrant community of users.”

For the first six months of 2019, Fitbit sales grew 7%, to $585.4 million, and reported a net loss of $73.8 million (an improvement from a net loss of $95.2 million in the first half of 2018).

The deal is expected to close in 2020, subject to customary closing conditions, including approval by Fitbit’s stockholders and regulatory approvals.

More Digital

  • Morning Show Apple

    Golden Globe Noms: 'The Morning Show' Turns Apple TV Plus Into a Kudos Contender

    “Euphoric” was the word to describe the atmosphere around the Apple TV Plus offices in Culver City, Calif., on Monday morning as staffers awoke to the news that the fledgling service’s cornerstone drama series, “The Morning Show,” had landed three major Golden Globe Award nominations. Apple Worldwide Video had exactly two employees — heads Jamie [...]

  • Game of Thrones Avengers Endgame

    'Game of Thrones,' 'Avengers: Endgame' Among Most Popular Tweets of 2019

    Twitter released its top-trending topics and tweets of 2019 with “Game of Thrones,” “Avengers: Endgame,” and actor Tom Holland commanding the most tweets in the TV, movies, and actors categories. BTS holds both the No. 1 spot in the most-tweeted-about musicians category and the second-most-retweeted tweet worldwide. Since its release in June, a video of [...]

  • Portugal's Cristiano Ronaldo celebrates his side's

    Canal Plus, beIN Sports In Exclusive Talks For Distribution Deal

    Vivendi-owned pay-TV banner Canal Plus Group and the global network beIN Sports have started exclusive talks to sign a five-year exclusive distribution and sub-licensing deal in France. The two companies previously tried to forge a partnership in 2016 but it was denied by France’s anti-trust board. Under the proposed deal, Canal Plus would distribute all [...]

  • NBCUniversal Peacock

    Comcast to Spend $2 Billion on NBCU's Peacock Streaming Service in First Two Years

    Comcast expects to pump $2 billion into NBCUniversal’s Peacock streaming service in aggregate over 2020 and 2021, while the company is projecting it will not be profitable for the first five years, according to CFO Mike Cavanagh. Cavanagh, who provided the details Monday at UBS’s Global TMT Conference in New York City, tried to put [...]

  • Watcher Entertainment - Steven Lim, Ryan

    Ex-BuzzFeed Video Staffers Launch Watcher Entertainment Digital Studio (EXCLUSIVE)

    UPDATED: After building their careers as internet personalities at BuzzFeed, the creators and hosts of three of the company’s biggest shows — Steven Lim, Ryan Bergara and Shane Madej — have formed their own digital-video venture. They quit BuzzFeed earlier this year and founded L.A.-based Watcher Entertainment, with the trio looking to get full creative [...]

  • 25. Oktober 2019, Berlin, Deutschland, JustWatch[Foto:

    Streaming Guide JustWatch Acquires Video Search Engine GoWatchIt (EXCLUSIVE)

    Berlin-based streaming guide JustWatch has acquired media search engine GoWatchIt from Plexus Entertainment, and is using the acquisition to open up its first office in New York. Terms of the deal, which was stock- and cash-based, haven’t been disclosed. GoWatchIt founder and CEO David Larkin will join JustWatch as its new senior vice president of [...]

  • CBS Joins Open AP Audience-Targeting Alliance

    CBS Joins Open AP Audience-Targeting Alliance

    “Young Sheldon” leads CBS’ Thursday-night schedule. Soon it may help to lead advertisers to a new way of placing their commercials. CBS has joined “Open AP,” the audience-targeting alliance working to accelerate the emerging advertising practice known as “audience buying.” Open AP works to give advertisers a way to buy impressions from particular types of [...]

More From Our Brands

Access exclusive content