Can Apple Watch Series 2 Revive Apple Watch Sales?

Can Apple Watch Series 2 Revive Apple Watch Sales?
Image Credit: ToomaCZ / Pixabay

According to data from research firm IDC, smartwatch shipments during the third-quarter of this year declined 52% compared to the July-September quarter a year ago. Apple Watch sales plunged 71.6% YoY from 3.9 million units in Q3, 2015 to just 1.1 million units in the latest quarter. The Apple Watch Series 2 was available for shipping only in the last two weeks of the reporting period.

Apple still the top smartwatch vendor with 41.3% share

IDC predicted that the Apple Watch Series 2 could help the iPhone maker rebound during the fourth quarter. The new model didn’t get a chance to stem the decline in the third-quarter. Lenovo and Pebble also witnessed a 73.3% and 54.1% decline in their smartwatch shipments, respectively. However, Garmin’s sales surged 324.2%, and Samsung’s smartwatch shipments went up by 9% during the quarter.

The smartwatch market is facing challenges due to low market demand and new product release timings. Only about 2.7 million smartwatches were shipped during the third quarter worldwide. Google held back the release of Android Wear 2.0, which left Android vendors with no option but to rely on older devices for sales. IDC revealed that Apple remains the world’s largest smartwatch maker with 41.3% market share, followed by Garmin with 20.5%, Samsung with 14.4%, and Lenovo with 3.4% share.

Fund Manager Profile: Kris Sidial Of Tail Risk Fund Ambrus Group

invest Southpoint CapitalA decade ago, no one talked about tail risk hedge funds, which were a minuscule niche of the market. However, today many large investors, including pension funds and other institutions, have mandates that require the inclusion of tail risk protection. In a recent interview with ValueWalk, Kris Sidial of tail risk fund Ambrus Group, a Read More

The Cupertino company doesn’t yet disclose sales figures of Apple Watch, so the market relies on third-party sources like IDC to determine the device’s success. The company clubs Apple Watch sales under the “Other Products” category, which includes sales of Apple TVs, iPods, Beats, and accessories. Apple is unlikely to be too worried about the decline in the third-quarter, but it would be a big cause of worry if sales do not pick up in the current quarter.

Apple Watch Series 2 unlikely to boost Watch sales

Earlier this month, KGI Securities analyst Ming-Chi Kuo predicted that the Apple Watch Series 2 won’t be able to revive the flagging sales of Apple’s smartwatches. That’s because the new Watch still suffers from a weak battery life, lacks any “killer” applications, and relies heavily on the iPhone. Kuo added that the multi-touch UI was not ideal for wearable devices.

According to the analyst, Watch sales are still driven by the hardcore Apple fans rather than the mass market. Pre-order data from Slice Intelligence showed that about one-third of the Apple Watch Series 2 buyers owned the first-gen Apple Watch. Apple has tied up with Nike and Hermes in an attempt to boost sales, but it’s unlikely to help, says KGI Securities.

KGI Securities has reduced its 2016 shipment estimates for Apple Watch by 15%-25%. Though Ming-Chi Kuo raised his Apple Watch Series 2 sales estimates by 10%, he said it would not be sufficient to make up for the decline in Series 1 sales. Price cuts for the refreshed Series 1 are unlikely to boost sales, either.

No posts to display