According to the latest figures from Counterpoint, a respected market research firm, there was a 7% drop in shipments in 2024 compared to the previous year, with significant repercussions for industry leaders like Apple.
Apple Watches Experience a Significant Decline
Apple, a dominant force in the smartwatch market, saw a notable 19% decrease in its watch shipments. The decline has been attributed primarily to the absence of anticipated new features in the latest models and the non-appearance of the much-rumored high-end Ultra 3 model. Anshika Jain, a senior research analyst at Counterpoint, highlighted that “the biggest driver of the decline was North America, where the absence of the Ultra 3 and minimal feature upgrades in the S10 lineup led consumers to hold back purchases.”
Further complicating matters for Apple were sales and import bans imposed in the US during late 2023 and early 2024. These bans were related to a disputed patent concerning the monitoring of blood oxygen levels. Such setbacks contributed significantly to Apple’s reduced market share, which dipped from 25% in the last quarter of 2023 to 22% in the same period of 2024.
The Rise of Chinese Manufacturers and Kids’ Smartwatches
While Apple and other premium brands have seen a downturn, Chinese manufacturers have seized the opportunity to expand their presence. Brands like Xiaomi, Huawei, and Imoo have reported substantial growth, particularly in segments such as children’s smartwatches. Imoo, also known as “Little Genius” in China, has become a noteworthy player, experiencing a 22% rise in shipments, primarily driven by parents’ growing concerns over child safety and the desire for connectivity.
Xiaomi, in particular, has made significant inroads, not just in China but across global markets, especially in regions like southern and eastern Europe. “Xiaomi has done a really good job of selling devices, particularly in regions where greater affordability tends to resonate a lot more strongly with customers,” commented Leo Gebbie, principal analyst at CCS Insight. This surge led to Xiaomi seeing a staggering 135% increase in shipments, mainly due to the affordability and appeal of its Smart Band activity trackers.
Market Recovery on the Horizon?
Despite the current slowdown, experts like those at Counterpoint are optimistic about a potential recovery. They forecast a modest rebound with single-digit percentage growth in 2025, driven by the increasing integration of AI features and a broader emphasis on health data.
This shift in market dynamics indicates a maturing industry where innovation and pricing will play critical roles in shaping future trends. As brands navigate these changes, the smartwatch sector may well be on the brink of a new era, marked by more nuanced consumer demands and the strategic adaptations of major players.
