Apple Takes Lead in Global Wearables Market

By Douglas A. McIntyre Updated Jan 12, 12:18PM EST · Published May 5, 6:50AM EDT

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Apple Takes Lead in Global Wearables Market — © Thinkstock

[cnxvideo id=”625483″ placement=”ros”]”Wearables” primarily refers to smartwatches, although some of them strap on to the head or around the arm. No matter where they are worn, Apple Inc. (NASDAQ: AAPL) has become the leading vendor in the market. Although that market is relatively small, it is growing quickly.

According to new research from Strategy Analytics, global wearable shipments rose 21% in the first quarter of the year to 22 million, compared with the same quarter a year ago. Apple growth took its market share to 15.8% from 12.1% last year. Neil Mawston, executive director at Strategy Analytics, said:

Apple shipped 3.5 million wearables worldwide in Q1 2017, rising 59 percent annually from 2.2 million units in Q1 2016. Apple captured 16 percent global marketshare and overtook Fitbit to become the world’s largest wearables vendor. The new Apple Watch Series 2 is selling relatively well in the US, UK and elsewhere, due to enhanced styling, intensive marketing and a good retail presence. Xiaomi shipped 3.4 million wearables for 15 percent marketshare worldwide in Q1 2017. Demand for its popular Mi Band fitness range was broadly flat across its core markets of Asia.

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Small rival FitBit Inc. (NYSE: FIT) has been on the ropes for some time. Its situation worsened recently. Cliff Raskind, director at Strategy Analytics, said:

Fitbit shipped 2.9 million wearables worldwide in Q1 2017, falling a huge 36 percent annually from 4.5 million in Q1 2016. Fitbit has lost its wearables leadership to Apple, due to slowing demand for its fitnessbands and a late entry to the emerging smartwatch market. Fitbit’s shipments, revenue, pricing and profit are all shrinking at the moment and the company has a major fight on its hands to recover this year.

Fitbit’s shares rallied recently as it posted strong first-quarter earnings. Strategy Analytics’ figures should undermine some of that confidence. Fitbit’s stock is down 78% in two years to $6.37, so the “undermining” has been going on for a long time.

The only bad news for Apple is that the wearables market is still a tiny compared with smartphones. Even at a 20% growth rate, that is not going to change for years, if at all.

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About the Author Douglas A. McIntyre →

Douglas A. McIntyre is the co-founder, chief executive officer and editor in chief of 24/7 Wall St. and 24/7 Tempo. He has held these jobs since 2006.

McIntyre has written thousands of articles for 24/7 Wall St. He is an expert on corporate finance, the automotive industry, media companies and international finance. He has edited articles on national demographics, sports, personal income and travel.

His work has been quoted or mentioned in The New York Times, The Wall Street Journal, Los Angeles Times, The Washington Post, NBC News, Time, The New Yorker, HuffPost USA Today, Business Insider, Yahoo, AOL, MarketWatch, The Atlantic, Bloomberg, New York Post, Chicago Tribune, Forbes, The Guardian and many other major publications. McIntyre has been a guest on CNBC, the BBC and television and radio stations across the country.

A magna cum laude graduate of Harvard College, McIntyre also was president of The Harvard Advocate. Founded in 1866, the Advocate is the oldest college publication in the United States.

TheStreet.com, Comps.com and Edgar Online are some of the public companies for which McIntyre served on the board of directors. He was a Vicinity Corporation board member when the company was sold to Microsoft in 2002. He served on the audit committees of some of these companies.

McIntyre has been the CEO of FutureSource, a provider of trading terminals and news to commodities and futures traders. He was president of Switchboard, the online phone directory company. He served as chairman and CEO of On2 Technologies, the video compression company that provided video compression software for Adobe’s Flash. Google bought On2 in 2009.