When Fitbit announced it was buying smartwatch maker Pebble last year, we knew it was for a low amount – but not this low.
Fitbit’s latest earnings release revealed it paid $23 million for Pebble, which is significantly less than the $30-40m range reported at the time. Vector, which Fitbit snapped up this year, cost it $15 million.
But we know we’re not the only ones who think Pebble deserved better, especially as luxury watch maker Citizen reportedly offered $740 million for the company in 2015. Pebble got a lot of things right (battery life!), and drew a huge following that was reflected in its mammoth Kickstarter campaigns. It was an underdog – just not one that could stay on top once Apple, Google et al moved into the smartwatch space.
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What’s sadder is that Fitbit is only taking on Pebble’s software and essentially chucking the hardware away. We recently did some digging and spoke to some insiders on what Fitbit’s next smartwatch will look like – because if you haven’t already worked it out, that’s where this is all headed.
As for the rest of Fitbit’s financials, there was a 19% revenue drop in Q4, but the company still has a lot of market share and margins are strong. On the earnings call, CEO James Park said the company once again reiterated that Fitbit is looking to form factors beyond the wrist. Clothes? Headphones? Answers on a postcard please.
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