The transaction, which is set to close this month, covers Fossil technology that’s under development, as well as talent, with some members of the watch firm’s research and development team set to join Google.
“Fossil Group has experienced significant success in its wearables business by focusing on product design and development informed by our strong understanding of consumers’ needs and style preferences,” said Greg McKelvey, executive vice president and chief strategy and digital officer of Fossil.
Details on the technology at stake weren’t disclosed as these efforts have yet to hit the market. McKelvey said: “We’ve built and advanced a technology that has the potential to improve upon our existing platform of smartwatches. Together with Google, our innovation partner, we’ll continue to unlock growth in wearables.”
However, considering Google already owns the Wear OS software that powers many of Fossil Group’s devices, the IP may relate to proprietary technology stemming from Fossil’s $260 million acquisition of Misfit in 2015.
Once the deal closes, Fossil’s tech will be poised to make the leap to other Wear OS partners.
Over roughly the past two years, a period when the tech industry largely pronounced smartwatches dead, Fossil stepped into the fray to pledge 300 new wearables — effectively making its bid to succeed where Silicon Valley couldn’t. The company developed and launched new Wear OS — née Android Wear — devices across 14 of its owned and licensed fashion brands, and today, the category is the watchmaker’s fastest growing.
For Google, the deal effectively doubles down on its wearables business. “The addition of Fossil Group’s technology and team to Google demonstrates our commitment to the wearables industry by enabling a diverse portfolio of smartwatches and supporting the ever-evolving needs of the vitality-seeking, on-the-go consumer,” said Stacey Burr, vice president of product management, Wear OS by Google.
Wall Street liked the move and shares of Fossil were up 5.5 percent to $18.38 in midday trading on Wall Street.