Apple Watch Captured Estimated 75% Smartwatch Market Share in Launch Quarter

[a.gomez]

I love it - if this was any other company (or bad data) people would be claiming that it has no real data behind the numbers and it is all. But seeing how it is Apple, everyone will just take it face value.

The thing did not sell as well as everyone thought - and that is not the end of the world.

 

[lazard]

Apple said (the CFO did) it sold more than the Ipad after 9 weeks, these Ipad numbers are ON THE RECORD, so that's at least 3.1M in the first 9 weeks. CFO and CEO at earning calls don't dabble in opinions, they're not allowed too.

How much more is the question, but but people put it at close to 4M (I,d expect close to 4.5M myself).

Considering it didn't have a retail presence or even an international rollout, those are fantastic numbers.

If Apple did sell 4M watches, that means they only sold about $660M worth of iPods, Apple TVs, Beats accessories, etc. during the quarter. 4.5M watches sold drops that number to about $417M.

 

[5105973]

The apple watch is for people with time on their hands.

Yet another device to troubleshoot, update, search out apps for, ensure is fully synchronized with the phone, iPad and Mac, so that they can glance at it rather than engage in the laborious process of pulling out the phone, which for many will be out and in use much of the time regardless.

It's not that time consuming. Sometimes I have to reboot it and that takes just a moment to do that and shake some bugs out. And this is not a device you're going to want to load up with too many apps. Just a few key ones. It's synced to my phone. I don't synch it to my iPad and I haven't used my Mac in a long time. My husband uses his Mac and IPad daily but synchs the watch only to the phone.

It's not that involved unless someone wants to make it more complicated. Really I just pick out the band I want to wear for the day, slide it on and go.

And I'm now just charging every other day. I'll have to charge daily when I go back to fitness tracking. But right now I don't have the time for that so I'm just wearing it for indoor work and not taxing the battery too much. It's been surprisingly convenient.

 

[5105973]

It sort of makes you wonder if the watch will suffer a similar fate as the iPad and people will hold onto older watches and keep using them instead of upgrading to the newest version like the iPhone.

Apple really needs to find a way to get people to upgrade iPads and watches like they do iPhones. We are told on these forums that most Apple customers are in a higher socioeconomic class and have plenty of disposable income so if that's the case Apple needs to find a way to motivate the majority of their customers to keep updating to the newest models.

I think they need to think about incorporating stylus Input more seamlessly to expand the use of iPads for photo editing and graphics creation. Doing things with my fingers and existing styli is really off putting and awkward.

They could come out with different varieties geared toward the needs of specific groups like musicians and artists and students and gamers. Anything is better than letting this concept languish and die.

As for the watch, they need to make the Sport model truly rugged enough for sports and charge more for it relative to the standard model, not less. I'd pay extra for warranted waterproofing and light weight and scratch resistant sapphire crystal with a case structure that protects the glass and crown a bit better without requiring a third party case. Oh and more sensors to increase fitness tracking capabilities. GPS wouldn't hurt, either.

 

[BruceEBonus]

Bizarrely I have not yet met one person who has either bought an Apple Watch or even knows someone who has. And in my job I meet a lot of the public. Yet conversely, everyone has or at least knows someone with an iPhone. Common sense has perhaps kicked in before their purchase? People maybe realised that to buy a product it has to fulfil a function and not just be a non-essential add-on to the iPhone. Which the Apple Watch basically is. That's my theory. Who knows? I'll tell you what. I'll make a point of asking them next time.

 

[paulsdenton]

It's weird, but I work out more because of the watch too! It's not a guilt (avoidance of a negative) trip, but a "want to do it" thing.

Me too. I'm competing against myself. And lost 26 pounds to boot! Love the thing! Can check msgs and mail without dragging out the iPhone. Great product!

 

[CFreymarc]

Is couple of billion dollars of turnover in 1 quarter, and higher 1st quarter sales than the iPhone 1 enough for people to stop saying it's a flop?

Those who can't do love attacking those who can do. The Apple Watch is a perfect example. Pebble got the ball rolling, then Android and now Apple. This will turn into a growing market with uses no one anticipated.

Surprised no one has bought Pebble yet moving their design into much higher volumes.

 

[DakotaGuy]

If Apple did sell 4M watches, that means they only sold about $660M worth of iPods, Apple TVs, Beats accessories, etc. during the quarter. 4.5M watches sold drops that number to about $417M.

Well they don't sell many iPods anymore and Apple TVs have been forgotten by Apple and customers. It would also appear that Beats products are poor sellers as well with such a small amount of revenue.

The Beats purchase looks like it was a bad decision considering the price other then some help with launching Apple Music. I give it a couple years until they sell the Beats hardware line off to another headphone or audio company.

 

[DDaddyx2]

Umm... yeah because the smart watch market it HUGE...

I just opened up a lamb and tuna fish shop now I have the market cornered...

The watch is terrible.... terrible....

I don't see an Apple Watch on your list of devices. What prompted you to return it? Because I assume from your statement that you purchased one and used it for some significant amount of time.

 

[Keirasplace]

If Apple did sell 4M watches, that means they only sold about $660M worth of iPods, Apple TVs, Beats accessories, etc. during the quarter. 4.5M watches sold drops that number to about $417M.

Hey, the CFO said EXCEEDS Ipad sales for that period. Not me. Take it up with him... Who is bound by law.

BTW, there were rumors of Ipod update and Apple TV update during that period which would explain dismal sales of those other devices pretty easily. Considering how much better the new Ipod is, very poor sales just before update is pretty understandable.

 

[martygras9]

I'm with you. Really love the Apple Watch.

It's certainly made me more health conscious. Blood pressure was a bit whacky before as I would go out drinking most nights. Since I've been tracking it, I've cut out booze, do sit ups every day, and walk every where instead of taking cabs (live in NYC). Blood pressure is under control now.

I've more energy now than I've had in the passed two years.

On top of everything else it does I'd say it's earned its place on my wrist.

 

[StyxMaker]

I love it - if this was any other company (or bad data) people would be claiming that it has no real data behind the numbers and it is all. But seeing how it is Apple, everyone will just take it face value.

The thing did not sell as well as everyone thought - and that is not the end of the world.

You're just skipping the posts that are critical of the data used in these estimates?

 

[Lazy]

I'm waiting on 2nd or 3rd gen watch. Mainly for better battery life, more sensors, better selection of apps and maybe a lower price.

And don't forget thinner. Of all the products Apple makes this is the one that most needs to be or would benefit from being thinner. I'm really hoping their thinness obsession gets applied to the watch too.

 

[JSB1540]

Bizarrely I have not yet met one person who has either bought an Apple Watch or even knows someone who has. And in my job I meet a lot of the public. Yet conversely, everyone has or at least knows someone with an iPhone. Common sense has perhaps kicked in before their purchase? People maybe realised that to buy a product it has to fulfil a function and not just be a non-essential add-on to the iPhone. Which the Apple Watch basically is. That's my theory. Who knows? I'll tell you what. I'll make a point of asking them next time.

I have met a number people in the 6 weeks I have had mine that own the watch. In my case the majority of the men I come in contact with on a day to day basis are in long sleeve dress shirts. I would have no idea what watch they had on. My watch does fulfill a function although you may not deem it necessary for you.

 

[62tele]

Umm... yeah because the smart watch market it HUGE...

I just opened up a lamb and tuna fish shop now I have the market cornered...

The watch is terrible.... terrible....

Have you owned one? Used it in daily activities. If not, you should be quiet and speak about something of which you have knowledge.

 

[62tele]

The apple watch is for people with time on their hands.

Yet another device to troubleshoot, update, search out apps for, ensure is fully synchronized with the phone, iPad and Mac, so that they can glance at it rather than engage in the laborious process of pulling out the phone, which for many will be out and in use much of the time regardless.

I spend zero time do any work of those things. Apple Watch is seamless and I have yet to find a need to "troubleshoot" it. On the contrary, it's a time saver. You really seem to have zero insight into this device.

 

[NachoGrande]

Have you owned one? Used it in daily activities. If not, you should be quiet and speak about something of which you have knowledge.

Yes I DO own one. So NO I won't be quiet....

 

[NachoGrande]

I don't see an Apple Watch on your list of devices. What prompted you to return it? Because I assume from your statement that you purchased one and used it for some significant amount of time.

There are about 15 devices that I own and aren't on my list. As you can see I haven't updated it in quite some time... But yes I own a 42mm Sport black/black.

 

[lederermc]

What a flop...can people quiet down about this "failure" now?

The flop was wall street expectations.

 

[Lazy]

It sort of makes you wonder if the watch will suffer a similar fate as the iPad and people will hold onto older watches and keep using them instead of upgrading to the newest version like the iPhone.

Apple really needs to find a way to get people to upgrade iPads and watches like they do iPhones. We are told on these forums that most Apple customers are in a higher socioeconomic class and have plenty of disposable income so if that's the case Apple needs to find a way to motivate the majority of their customers to keep updating to the newest models.

No they don't. That's just like saying they need to find a way to get people to upgrade Macs like they do iPhones. That's silly and won't happen and if one needed to get a new Mac every two years that'd be bad. Knowing it will last many years is a big selling point for Macs.

If iPads and watches last a long time like Macs do, that's ultimately good for Apple.

 

[firewood]

Apple said (the CFO did) it sold more than the Ipad after 9 weeks, these Ipad numbers are ON THE RECORD, so that's at least 3.1M in the first 9 weeks. CFO and CEO at earning calls don't dabble in opinions, they're not allowed too.
.

Yes, but that iPad number was in regards to a longer period of weeks than the watch has been shipping. So the iPad number can be scaled lower and still be accurate over a matching number of weeks, perhaps to as low as 2.5M, depending on the shape of the iPad ramp. A lower unit number allows the possibility of a higher Watch ASP (without exceeding the reported Other number) to account for some percentage of stainless steel and Edition models.

 

[kdarling]

From the article:

"Many analysts have adjusted their Apple Watch sales estimates following the company's earnings report on Tuesday, with the consensus now ranging between 2.2 million and 3 million units sold"

Elsewhere on MR I read that iPad sales 3 million in the first 90 days, and Cook said watch sales exceed iPad sales in the same time period. I.e. he said they were at least 3 million. And 2.2 to 3 million is these guy's new range? Huh?!?

Depends on how much of that revenue was due to the Watch, and what the ASP was. For the range of $1B to $1.5B revenue, and ASPs either at the low or high end (more high end watches = less sales), plus a lot of bands sold, the number of watches sold can indeed range from about 2.2 to 3.3 million.

As for the oft-mentioned iPad numbers... Cook did NOT say what people think he did.

Here's what Cook actually said:

"To give you a little additional insight, through the end of the quarter, in fact, the Apple Watch sell-through was higher than the comparable launch periods of the original iPhone or the original iPad. "

Notice that he specified "sell-through", NOT "sales". That's an entirely different ball of wax. Sell-through to end users is often less than the highly publicized sales (shipments) to retailers... sometimes millions less.

Checking back through previous calls, it appears that sell-through on the first iPad quarter might have been around 2.7 million. We also need to figure out what "comparable launch period" means.

He also made this comment, talking about sales increasing over time:

"On the Watch, our June sales were higher than April or May. I realize that's very different than what some of the -- is being written, but June sales were the highest."

Which makes perfect sense if one understands that online purchases... unlike retailer purchases... are not counted as sales until they arrive at the end consumer. Very few consumers got a watch right away. Instead, more and more people got devices delivered as time went on and production ramped up. So naturally June had the most "sales", even if most were pre-ordered back in April.

This is all part of the verbal sleight-of-hand that Jobs was a master at, and Cook is clearly trying to be a good pupil. It always amazes me that most tech reporters fail to notice these critical phrasing details.

 

[name99]

That's one way to look at it I suppose.

I look at it this way: The wearables market is still in it's infancy, and struggling to take off. Apple shows up, late to the market, and absolutely dominates it. Not by a little, but by a lot. Within months. Sure, it's not a huge market, but now it has the potential to be one.

Why SHOULDN'T it be a huge market? The watch at $350 is for many people a (semi) luxury purchase, sure, but we've all seen how this plays out. Apple introduces aWatch2 at $350 and still sells the Sports aWatch 1 at $250. In 2017 they introduce aWatch 3, and drop the price of sports aWatch1 to $150. They've done this with phones and iPads; why wouldn't they do it with watches?

At $150, with the eBay market starting up, and with a substantially improved OS, why shouldn't the market ultimately be one for every person on earth? Hell, at some point it might become useful enough that some of us wear one on each wrist, so we have more "screen space" tracking different things, or just as a fashion statement. Plenty of people have more than one cell phone for various reasons...

Around say 2007, people thought it was crazy to talk of a cell phone for every person on earth (EVERY person, not every rich person) let alone a smart phone. But that's close to where we are today...

 

[name99]

Exactly. Since I got my Pebble 2 years ago it quickly integrated itself nice and neatly into my life. Just waiting on Apple Watch 2 before I make the jump.

Hell, why suffer? Buy one today. I had a Pebble, which I agree was nice and did the job, but aWatch is SO much nicer. Yes, the second model will be better, as will the third and the fourth. But every year you delay buying is also another year you are punishing yourself.

 

[stanhope]

One way to lift market share even further is to make it possible to have 2 Apple watches operational easily. I would buy a second one because not only would I like another look but aLeo for those occasions I forget to charge the watch. Hopefully as the watch becomes less dependent on the phone this will happen.