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Apple Watch Research. How fast is smartwatch market growing?

Apple Watch on hand

While our world continues to develop so quickly, the biggest companies are fighting for higher revenues and for number one titles in their niche. Tech companies such as Apple, Samsung, and others are shifting their focus to less saturated products. Five years ago, Apple was famous for its incredibly designed iPhones, iPads, and MacBooks, the products which changed our lives. Today, Apple has more incredible products, one of which is Apple Watch.

In 2015, the first Apple Watch was released and it quickly became the best-selling wearable in the world. Apple understood that the smartphone market would stop growing at some point and that they would be able to compensate revenue loss with wearables, Apple’s fastest growing sector.

Last year, the market of smartwatches reached around 63 million shipments. Experts predict that the market will grow to 113 million shipments by the year 2022. That’s a massive opportunity for tech companies.

 

Smartwatch shipments 2017-2022

Estimated global smartwatch shipments in millions

 

 

Apple Watch sales and revenue

 

Apple does not report sales and revenue by the product. Nonetheless, tech analysts made their estimations for the last 3 years.

In 2017, taking into account that Apple Watch 2 (starting price at $369 and $399) and Apple Watch 3 (starting price at $329 and $399) were for sale in 2017, 16.7 million smartwatches were shipped at an average price of $400. That earned Apple roughly $6.68 billion.

In 2018, Apple was selling Apple Watch 3 and Apple Watch 4 (starting price was increased to $399 and $499, depending on whether you need GPS-only or GPS+cellular model). Taking into account the $425 average price, Apple sold an estimated 22.3 million smartwatches and earned $9.477 billion.

In 2019, Apple Watch 3 (at reduced price), Apple Watch 4, and Apple Watch 5 (starting price at $399 and $499) were for sale. At $450 average price, Apple sold an estimated 27.9 million units of smartwatches and earned $12.555 billion. That’s almost 88% growth from 2017.

 

Apple Watch revenue

Estimated Apple Watch revenue in billions $

 

 

Comparison with other Apple products

 

It is obvious that the impact of Apple Watch on Apple’s business is getting bigger. If we look at numbers during each of last 3 years, we will see mathematical proof of this phenomenon.

In 2017, Apple earned $229.234 billion in total revenue. Looking at revenue shares, 60.5% comes from iPhone, 11.6% - MacBook, 8.6% - iPad, 2.9% - Apple Watch.

In 2018, Apple’s total revenue was $265.595 billion, a massive 15.9% increase from 2017. Revenue shares: 62% - iPhone, 10% - MacBook, 7% - iPad, 3.6% - Apple Watch.

In 2019, estimated Apple’s total revenue is $260.174 billion. That is a 2.04% decrease from 2018. Revenue shares: 54% - iPhone, 10% - Mac, 8% - iPad, 5.5% - Apple Watch.

While iPhone is losing its position in the company’s revenue, Apple Watch earns more and more every year. The smartwatch market is likely to almost double in size by 2022. The assumption, therefore, is that Apple Watch’s proportion in revenue shares might continue to increase and possibly reach Mac’s current position.

 

Apple Revenue share 2019

Estimated revenue share in 2019

 

 

Apple Watch in comparison with other popular companies

 

Apple Watch estimated revenue in 2019 vs other popular companies

Estimated total revenue in billions $ in 2019

 

Apple is one of the most valuable companies in the world. Let’s compare its Apple Watch segment with other well-known companies.

From the graph, we can see that Apple Watch almost reached Instagram by revenue in 2019 – $14.6 vs $12.555 billion. That shows an incredible success, considering it is still a pretty small product compared to iPhone.

Will Apple Watch overtake Instagram by revenue in 2020? Probably not. Instagram is also growing quickly. Experts predict Instagram will reach $22.2 billion in revenue, while Apple Watch is predicted to earn $15.3 billion.

 

 

Apple Watch vs Fitbit vs Rolex + trends

 

Apple Watch is already way bigger than Google’s Fitbit ($1.56 billion in 2019) and even well-known manufacturer of luxury watches – Rolex ($8 billion in 2019).

Taking a look at Google Trends by watch specific keywords, Apple Watch is an obvious winner with a steadily increasing curve. Congrats Apple!

Watch market trends

 

 

Last word

 

Apple Watch is definitely a very successful product released by the company. The market of smartwatches is growing, and all the numbers predict a bright future for the product. When a single product can reach a revenue level of companies like LinkedIn, Adobe, or Instagram, that already speaks of a huge success.

 

 

Original content by Pigtou

Data sources:

Statista.com

Apple.com

Macrotrends.net

 

 

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