Detailed information regarding promotion or fusion of gears can be found [Menu] → [Blacksmith].
Gear Promotion
You can promote your gear to the next class, with a gear at its maximum level + metal fragments + Gold.
If you want to promote something higher than legend class, you need a schematic.
Enhancement level, options, brand and durability will remain the same and the level of the promoted gear will set to 0.
Gear Fusion
With 2 gears of same part and same class, you can make a higher class one.
You need 2 same class, same part gears at their maximum level for a fusion.
Options and gems will be given randomly and all the gems on the fusion material will be disassembled and turned into mystic dust.
A fusion may end up with brand option.
If you make a fusion with brand gears, chaces are, brand option can be lost.
Enhancement level, options, brand and durability will remain the same and the level of the promoted gear will set to 0.