Google’s parent company Alphabet has made a bid for wearables producer Fitbit, resulting in the latter’s shares jumping 27pc.
As Alphabet released its latest quarterly performance report, the tech giant’s plans for control of the fitness wearables market were also revealed. According to Reuters, Google’s parent company has made an offer for Fitbit – a household name in fitness wearables – in order to take a large slice out of a competitive marketplace.
A source close to negotiations said it is still too early to tell whether a deal can be agreed between the two. Regardless, shares in Fitbit rose by 27pc following the news. However, the company has faced challenges over the past few years with a number of new players entering the fitness wearables market, noticeably from China with Huawei and Xiaomi.
Meanwhile, Alphabet reported a revenue increase of 20pc as the technology giant hailed its “strong growth” in its latest financial results. Alphabet said revenue for the last quarter was $40.5bn, up from $33.7bn this time last year.
As usual, the Google arm of Alphabet generated the vast majority of the firm’s revenue, including $33.9bn in advertising revenue. However, net income fell compared to the same quarter a year ago – from $9.2bn to just over $7bn, falling short of analyst expectations.
“I am extremely pleased with the progress we made across the board in the third quarter, from our recent advancements in search and quantum computing to our strong revenue growth driven by mobile search, YouTube and cloud,” Google chief executive Sundar Pichai said.
“We’re focused on providing the most helpful services to our users and partners, and we see many opportunities ahead.”
Elsewhere in the results, Other Bets, the segment of Alphabet made up of the firm’s more outlandish projects such as its self-driving car firm Waymo, saw losses increase to $941m. That is up from $727m this time last year.
Alphabet chief financial officer Ruth Porat said the firm would “continue to invest thoughtfully in talent and infrastructure to support our growth, particularly in newer areas like cloud and machine learning”.
Google also recently updated its main hardware lines releasing its latest Pixel 4 smartphones and Nest Mini smart speaker.
Google’s efforts in quantum computing recently made headlines with its claim that it had achieved “quantum supremacy” with a machine that far outshone even the most powerful supercomputer. In a scientific paper, Google said its technology could solve a problem in a matter of minutes that would otherwise take 10,000 years.
However, competitors such as IBM have hit back at Google’s statement, claiming the company is underestimating the power of its supercomputer, Summit, which could calculate the same problem in a little over two days.
– PA Media, with additional reporting by Colm Gorey