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December 2, 2016 IT News

Pebble valuation shrank to $40 million from $700 million

It is reported that Fitbit will acquired Pebble, the founder of smart watch.

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VentureBeat reported that the acquisition amount of Pebble is between $34 million and $40 million. The valuation of Pebble shrank a lot.

Fitbit and Pebble did not confirm the news of acquisition yet. It is said that Fitbit will take over the intellectual property and other technical reserves concerning smart watch from Pebble. This acquisition may help Fitbit to explore in other production lines.

CNET reported that the overall smart watch market shrinks fast as expected. Smart Watch was considered as the next mainstream after the release of smart phone. Venture capital firms and startups started exploring in this industry. However, the statistics and development of smart watch in the past few years showed that the need of wearable devices was not as huge as manufacturers expected.

Apple Watch did not sell well as expected in the past quarters. It failed to become a redefined product after iPhone and iPad. Smart watch shares similar functions with smart phone which seems to negative for its promising.

Pebble was considered as the founder in smart watch industry.It launched products two years earlier than Apple. It raised money through Kickstarter platform in the beginning. Pebble released several series of smart watch devices since its establishment. However, its sales scale and competitiveness were relatively weak.

In March, Pebble announced to cut 25% of workforce. Its smart watches were cheaper compared with Apple Watches. Some senior officer revealed that it only sold about 1 million smart watches in total since the products release.

Pebble failed to consolidate its dominant leading position in smart watch though it released smart watch eariler. WIth the release of Apple Watch, Samsung Gear, Pebble made itself in a difficult position.

Fitbit became a listed company last year, whose share price increased by 66.6% then. However, its share droped sharply a few months later. Its current share price is down to about $8.

Will Fitbit revive its performance and share price through the acquisition of Pebble is unknown yet.

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