Fitbit buyout saves company

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In the past year, a trend of large companies acquiring smaller companies has been adopted on a global scale. Google’s parent company, Alphabet, has been planning to buy Fitbit for approximately $2.1 billion. The company is planning to buy and close the deal in 2020. The purchase of Fitbit will help Fitbit boost revenue as it needs to recover the funds lost against Apple’s smartwatch. The hope for Fitbit is that it will become popular and expand.

“There would be no issue for buying a Fitbit when Google owns the company,” said art teacher Mr. Matthew Gruenfeld.
Since the purchase, 27% of Fitbit’s shares have risen. This gave the company $1.4 billion of the capitalization in return. For Alphabet, their shares have grown 2%, and their capitalization rose to $1,293.49 in the previous fiscal year.

Accounting for the buyout, Fitbit has been struggling with sales. They had made an effort to improve their company by partnering with health insurers and the healthcare market. In August, Fitbit had signed a contract with the Singapore government for them to provide fitness trackers and health service programs that could reach up to 1 million people using the Fitbit.

Although, there are some negative effects of the purchase. Fitbit users have said that they are starting to be weary of Fitbit products after Google has bought their devices regarding their security. Customers are worried about their privacy and how privacy can be invaded- especially when Google is involved.

“Buying a Fitbit from Google would not be necessary because humans can keep track of their own health,” said senior He Baí.
With Google buying Fitbit, the company will either be helped greatly or it will bring the end of the company.

With the advancements in modern technology, Google may choose to combine Fitbit with their personal health analytic devices in the future. In the meantime, the buyout has saved Fitbit’s finances which gives the company time to brainstorm new ideas for health tracker products.