Monday. Reuters first reported that Alphabet made the offer to buy Fitbit. Fitbit’s stock was halted after skyrocketing more than 18%.
The stock resumed trading and was up about 27% Monday afternoon, adding more than $280 million to its market cap to bring it around $1.4 billion. Fitbit shares are now up more than 10% for 2019.
It’s unclear how much Alphabet offered to buy Fitbit.
The deal would make Alphabet a player in the wearable fitness tracking space, competing against the likes of Apple, which recently released a new version of its popular smartwatch. Google licenses its Wear operating system to companies like Fossil, but does not currently make its own smartwatch.
Google has described its hardware strategy as “ambient computing,” meaning users should be able to access its services wherever they are. Buying Fitbit could be a play to make Google services a greater part of customers’ lives and measure up to Apple in the health and fitness space. Google hired former Geisinger Health CEO David Feinberg last year to consolidate its healthcare strategy. The company announced several new hardware products earlier in October, including the new Pixel 4 smartphone.
For Fitbit, support from Alphabet could grant a much-needed boost for the company, which has seen Apple take over about half of the global smartwatch market in 2018 in terms of units shipped, according to Strategy Analytics. In its July earnings release, Fitbit lowered its guidance for the year, citing weaker-than-expected sales of its new lightweight watch.
Representatives from Alphabet and Fitbit were not immediately available to comment