Pebble has announced it will trim its workforce by 25 percent, a move that is being blamed on heightened competition in the segment. That translates to 40 of its employees who will be losing their jobs.
Pebble CEO Eric Migicovsky blamed the not so friendly fundraising environment in Silicon Valley that has left them with no option but to cut its workforce.
“We’ve definitely been careful this year as we plan our products,” Migicovsky said. “We got this money, but money is pretty tight these days.”
The company managed to raise $26 million during the last eight months.
Pebble may have been among the pioneers of the smartwatch revolution though the company is facing increasing competition from Fitbit, Apple and Samsung. Apple has also recently reduced the price of its smartwatches by $50 so that they now start from $299. Fitbit is already being considered as the leader of the wearables segment.
Pebble is among the first to launch a smartwatch and targets the lower end of the segment. Its smartwatches typically cost around $100 – $250. It has disclosed a sales figure of a million smartwatches sold during the period from 2013 till February 2015.
In contrast, Apple seems to have fared far better with sales estimated to be around the 10 million mark since its launch in April, 2015.
Migicovsky though said they have a future roadmap ready, and the recent layoffs can be considered to be in tune with its long-term plans. The Pebble CEO further added they are keen to focus more on the fitness and health aspect of the smart wearables, the most lucrative part of the segment right now.
“We want to be careful,” Migicovsky said. “Pebble is in this for the long haul. We have a vision where wearables will take us in five to 10 years, and this is setting us up for success.”
Market research firm IDC has said the global market for smartwatches and wearables has shown a twofold rise to 78.1 million units in 2015. However, competition is expected to intensify further with even companies like the China-based Xiaomi too entering the fray. Xiaomi is known for their ability to launch high-end devices at rock bottom prices, something that they no doubt will apply to the smartwatch segment as well.
Meanwhile, Pebble said they next intend to launch their range of smartwatches in India in partnership with Amazon.