While still the dominant leader, Apple’s share of the smartwatch market continued to dip during the second half of 2018 as greater variety and less expensive options become available, according to new data from ABI Research. These findings came as Apple cut its revenue guidance for the first quarter to $84 billion, citing lower iPhone revenues, particularly in China, and the impact of macroeconomic conditions. In Q2 and Q3 of 2018 Apple’s share of the smartwatch market dropped to 43.35 percent, marking the lowest point since the same time last year, according to ABI. The company still leads though, with Fitbit, Huawei, and Samsung following behind with roughly 8 percent share each. Overall, ABI forecasts that smartwatch shipments will increase from 40 million in 2018 to more than 99 million in 2023. “The smartwatch market is a major part of the overall wearables market, offering consumers access to a large number of wearable features, such as fitness tracking, notifications, and heart rate monitoring, from the wrist,” said Stephanie Tomsett, research analyst at ABI Research, in a statement. “As the number of flagship and budget smartwatches continues to grow, consumers are increasingly opting for devices from companies other than Apple, such as Fitbit, Huawei, and Samsung. Hence, Apple has seen its market share drop over the past couple of quarters.” In a letter to investors, Apple CEO Tim Cook said the company had predicted supply constraints would affect sales of certain products during Q1 and, as expected, sales of the Apple Watch Series 4 were constrained for “much or all” of the quarter. However, Cook said revenue outside of the iPhone business had less exposure to emerging markets, and Apple’s wearables category grew by almost 50 percent year over year. Cook wrote that the Apple Watch and AirPods “were wildly popular among holiday shoppers.” At $499 for the LTE option, the Apple Watch 4 offers about 18 hours of battery life and added features like a fall sensor and ECG readings in the U.S. The Samsung Galaxy Watch with LTE starts at $379, with about three days of battery life and most of the same features as the Apple Watch (excluding fall sensor and ECG capabilities). ABI notes that the Huawei Watch GT starts at $230 and has a long battery life of 14 days and is compatible with both iOS and Android devices, while the Fitbit Versa doesn’t offer an LTE version and is cheaper, starting at about $200. “Apple will continue to ship a large number of smartwatches to both loyal and new customers. However, with so many other smartwatches available with most of the major features of the Apple Watch, at a reduced price, increased battery life, or with greater compatibility with a larger number of smartphone OSs, more consumers are likely to move away from Apple in favor of these other devices,” Tomsett concluded.
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