Apple Watch sales might have dropped 40% in the first quarter, but the end isn't near

Apple Watch sales might have dropped 40  in the first quarter, but the end isn't near

Apple is just as keen on boasting about iPhone sales numbers as it on admitting that they used to be a little better not too long ago. When it comes to the Apple Watch, though, the Cupertino watchmakers have kept sales data shrouded in mistery since debuting the wearable a year ago. This hasn't stopped analysts from scavenging information out of suppliers, retailers, and those in the know. One such specialist is ITG senior analyst Matthew Goodman who came up with an upsetting claim. Citing proprietary data, he says that Apple Watch sales for the second fiscal quarter (first calendar quarter) are down 40% compared to the first, which concluded on December 26, 2015. Between January and March, Goodman estimates Apple sold 3.1 million units globally.

From an objective perspective, this isn't necessarily bad news. In spite of seemingly lackluster sales, last year Apple grabbed more than half of the smartwatch market share for itself, according to Juniper Research. Moreover, the company's first fiscal quarter doesn't include the intense holiday shopping season, which saw the Apple Watch land on the wrists of many who didn't get ahold of it earlier in the year, for reasons including limited availability and lack of awareness. In addition, the entry-level Apple Watch Sport model's $50 price cut this March helped sales double for a week, before returning to their earlier levels.

Although the wearable is the type of "slow burner" success that isn't typical of Apple products, it nevertheless has long-term potential. Goodman believes the company is well-positioned to capitalize on the gadget as the market matures and smartwatches become more compelling for customers. With strong market share and plenty of resources to pour into smartwatch development, Apple has the presence, persistence, and design mojo to sustain and expand its position as a leader in the category.

The next-generation Apple Watch could be introduced at the company's WWDC event (13–17 June), with sales beginning shortly after. According to the available information, the wearable represents an "s"-style upgrade over its predecessor, concentrating on internal improvements rather than substantial exterior changes. Then again, the wearable is rumored to be as much as 40% thinner than before, which is a remarkable engineering achievement considering the need to pack a reasonably powerful integrated mini-computer and battery inside such tiny space. For more intel on the upcoming refresh, feel free to read our Apple Watch 2 rumor review.

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source: Fortune

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39 Comments

1. fyah_king unregistered

I haven't seen anyone with a smartwatch in person, yet.

2. Acdc1a

Posts: 470; Member since: Jan 21, 2016

You don't get out much do you?

7. fyah_king unregistered

I don't walk around looking at their arms to see if they have a smartwatch.

13. nctx77

Posts: 2540; Member since: Sep 03, 2013

Exactly. I see them quite a bit.

20. sgodsell

Posts: 6897; Member since: Mar 16, 2013

If the Apple watch is selling so well, then why did Apple permanently drop the price of the sport watch? This week Bestbuy is dropping $200 off the steel Apple watch. Apple never does this if things are selling well. I lived long enough to see a lot of Apple propaganda.

21. bubbadoes

Posts: 1225; Member since: May 03, 2012

it's hard to believe some of these post even come within an inch of any thought what so ever...Apple didn't drop the price on nada! Best Buy dropped the price to move a product! Macbook pro's, ipad mini's are also on sale also...no different that the BOGO Best Buy had for the GS7.. Samsung didn't offer that either, but Best Buy did.

32. AlikMalix unregistered

sgodsell, since day one, retailers drop prices for all products that are popular to gain foot traffic to their stores. Since the begining of iPhone (or any smartphone for that matter) there were always cheaper alternative retailers that you can buy the same device than Apple Store or online from Samsung for example, (sometimes almost immediately after release). Walmart has always sold iPhone at least $50 cheaper than what you'd get at Apple Store. The deals come from retailers themselves - not Apple, Samsung, etc... Manufacturers usually drop the price when they release updated versions of device or right before.

24. darkkjedii

Posts: 30836; Member since: Feb 05, 2011

I just saw a lady with an Apple Watch on in 7-11, while getting coffee. I see tons of them, and Gears.

27. TechieXP1969

Posts: 14967; Member since: Sep 25, 2013

Sure you do. I wont say you are lying. But consider my true to life scenario. I spent 2 weeks in Florida. One of those weeks was at Disney Theme Parks for 7 days. Five of those days I stood in line with literally hundreds and hundreds of people. For rides, games, food, souvenir shopping and more. Potential with Apple shipping 8 Million, that means 1.3M could be shipped to 6 continents. Doing the math, potentially many markets can't even afford them. Which means the vast majority would have to have shipped to the United States and Europe. I should have seen more than 2 people that I work with with one. The only place I've seen them is on display. I've never even seen anyone buy one. As much as I frequent Costco and Target and have seen people purchasing iPhones and iPads and even the iPod Touch, I've never seen anyone with an Apple Watch purchasing it. EVER! Am i looking for people to have them? No. But I've seen people wearing the Moto 360, FitBits, and the Gear S and S2. I frequent Xsport Fitness which I have been a member for 2 years now. Again I see Fitbits and other cheap options and Ive even seen the Microsoft Band a couple times, but never a Apple Watch. The sport model I expect would stand out to to its brightly colored bands. The next model up pretty much looks like any other watch, so I give the benefit of the doubt I could have seen an Apple Watch and just didn't know it. But the spot model being the lowest costing one is the one I expect would have sold the most as all of them are excessively price in cost and yet I've seen not one in the wild. Even the 2 co-workers have the one above the Sport model. But you wanna say you see them quite a bit. Really? What City and State do you live in? Because unless you work in Silicon Valley, who else is going to buy them? I live in the 3rd largest city in the USA. My main company does structured cabling for retailers and restaurants for POS equipment and people counters. As many retailers I have frequented and eateries and more, I would guess I would have accdently seen one, yet I've seen none. My work increases my chance of seeing such. My workouts every week would increase my chances of me seeing one, yet beyond 2 employees I've seen ZERO. I want one too. But after wasting $300 on the original Gear, ther is no way I would pay Apple MORE money for a device 2 years later that does less then it did. I cam say with a certainty that millions of people would say the same. You have a camera phone. Take pictures the next time you see them being worn. Friends, family or co-workers don't count.

34. AmirBudi

Posts: 88; Member since: Mar 21, 2014

Techie forget China

3. Ninetysix

Posts: 2933; Member since: Oct 08, 2012

Gotta go outside brosephine.

4. tedkord

Posts: 17135; Member since: Jun 17, 2009

I've seen some (including myself), but not many.

11. MSi_Cubi unregistered

i wudnt even buy this crap for 50 quid

17. Finalflash

Posts: 4063; Member since: Jul 23, 2013

I don't know about that. Got a Moto 360 for 60 pounds last July and it has been worth it so far. I wouldn't put more than 100 on it though.

12. MSi_Cubi unregistered

the point is in smartwatches there is no ART AT ALL .. those millionaires would be ashamed.. They only show you watches which cost like 5000 euro to million euros .. and more coolmaterial.com/roundup/expensive-watches/

23. darkkjedii

Posts: 30836; Member since: Feb 05, 2011

Go outside some time...introvert.

26. TechieXP1969

Posts: 14967; Member since: Sep 25, 2013

I see people wearing smartwatches and other wearable. I've not seen anyone outside of 2 co-workers wearing an Apple Watch. So I wanna know who bought them. I wonder how many Target has sitting in their warehouse. Since carriers can't tie you to a data plan because they are WIFI only, carriers dont have them. So they are only being sold by Apple and retailers. Who's buying them?

30. MSi_Cubi unregistered

it won't be end user but dozen rich companies and few ppl in small groups have them..and + those ppl who got them for free .. movie stars or music stars just for promoting..

35. AmirBudi

Posts: 88; Member since: Mar 21, 2014

Techie, how about China ?

31. AlikMalix unregistered

I see probably 2-3 a week and half of those are Apple Watch the other half Android and fitness bands... (Central California)

5. Unordinary unregistered

If they dropped 40%, I really feel bad for the competition, given the other obvious facts

8. PhoneCritic

Posts: 1345; Member since: Oct 05, 2011

The competition is not priced as high as the Apple watch so I can understand the claim of 40% drop. However, we will have to wait for Apples earning call to really get any idea of how much a drop or uptick there was. As for myself I have only seen two people with the Apple watch But I do see a fair amount ( at least 10) of people with the Gear 2 sports Edition. But still adoption rates for smartwatch are still pretty low.

16. Unordinary unregistered

Quite the opposite for me here - NYC area.

18. tedkord

Posts: 17135; Member since: Jun 17, 2009

Probably won't get an idea from the earnings call. Apple hasn't given any numbers for the watch. If it dropped as much as we've heard, then they're even less likely to now.

28. TechieXP1969

Posts: 14967; Member since: Sep 25, 2013

The Gear S2 starts at 299 with the 3G/4G version cosyig $350. I bought 2 Gear S2's via T-Mobile for $360 each. I also have my Gear S which I paid 399 via Verizon. Most other WIFI only options are certainly cheaper than the Apple Watch, but other than Fitbits, Moto 360's and some other options that are cheap unly knockoffs, I've not seen much else. Smartwatches are boring, expensive, limited, and basically if you own a smartphone useless. The only use I have had is, when I bike ride, I now have the option to leave my phone at home and I still can listen to my tunes and get my calls. There price at least or Samsung and Apple's options, are simply to pricey for many and unless you are rich, probably wont buy them.

6. ibend

Posts: 6747; Member since: Sep 30, 2014

just 3.1m this quarter? didnt they ship like 5 times of that? (I cant remember the number, but I remember some article said they ship alot more than that number :-/ )

9. PhoneCritic

Posts: 1345; Member since: Oct 05, 2011

Yes, Shipped but out right Sold ( to a customer) we have no Hard numbers from Apple yet.

29. TechieXP1969

Posts: 14967; Member since: Sep 25, 2013

They shipped 8M per PA.

10. SIGPRO

Posts: 2810; Member since: Oct 03, 2012

Apple watch is a flop.......knew this from day 1!

15. Napalm_3nema

Posts: 2236; Member since: Jun 14, 2013

Yeah, the niche product that in 9 months outsold the entire Surface line for 2015 is a flop. You better call Microsoft and give them the bad news.

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