There’s no doubt the world economy is struggling with the increase in unemployment and all the shutdowns. Not all industries are struggling, but they’re also not booming. The wearables market, despite the economy, is still showing growth. However, the first quarter this year showed less than one-third of the growth that was expected for the year.
Wearables Economy Slowed
While you might think that with a struggling economy, non-essentials would struggle significantly, but that’s not necessarily true. But it’s more complicated than that.
Projections from ABI Research show that direct shipments are expected to be up five percent year-over-year from 2019 to 2020. However, predictions were initially at 17 percent for the year. Last year there was a 23 percent growth between 2018 and 2019.
The changing projections lead to manufacturers now being expected to ship 254 million devices in 2020. Last year it shipped 241 million.
While certainly, people are buying fewer non-essentials because of the struggling economy, there is still some interest there in wearables. With people being encouraged to stay home more, they may not be looking for things such as fitness trackers.
However, there’s also an increase in personal health, and that can be gauged on a wearable, whether it’s a fitness tracker, smartwatch, or even a smart ring. This may be keeping the market going.
Apple Still at Top
In this first quarter, however, Apple is still at the top of the list, cornering the market on wearables. This isn’t surprising considering it led all others in the last quarter of 2019. It still had an increase in shipments of wearables this past quarter. The other leading companies are seeing growth as well.
In the first quarter of 2019, Apple shipped 13.3 million wearables, while in this most recent first quarter, the company shipped 21.2 million. They went from a 23.7 percent market share to 29.3 percent.
Xiaomi had the second most shipments with 10.1 million this past quarter, while it only had 6.5 percent last year. Samsung went from 5.0 million to 8.6 million, Huawei from 5.0 million to 8.1 million, and Fitbit actually had fewer shipments, dropping from 2.9 million to 2.2 million.
Looking just at smartwatches, Apple is still the king with the Apple Watch, but it slipped one tiny bit. While its market share in the first quarter year-over-year went from 25.4 percent to 26.8 percent, it shipped fewer devices. 4.6 million Apple Watches were shipped in Q1 last year compared to 4.5 million in Q1 this year.
Apple still owns one-quarter of the smartwatch market. However, the others are growing. Huawei went from 6.4 percent to a 15.2 percent market share, Garmin went from 5.3 percent to 7.5 percent, and Huami went from 0.5 percent to 1.0 percent, doubling, while still only having 1/100th of the total market share. Samsung’s market share remained the same with 10.8 percent.
The wearables economy definitely isn’t what it was a year ago or what was projected for this year, but it’s still doing well when many companies are declaring bankruptcy, filing for a loan, or closing up shop altogether. It will be interesting to see how the wearables market recovers.