Global sales of smartwatches have fallen for the first time, new figures indicate, largely due to a sharp decline in the popularity of market leader, Apple.
Market research firm Counterpoint reports a 7% decrease in device shipments in 2024 compared to the previous year.
Shipments of Apple Watches specifically fell by 19% during that period, according to Counterpoint.
The firm attributes the slump to a lack of new features in Apple’s latest devices, and the absence of a rumored high-end Ultra 3 model.
“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,” said Counterpoint senior research analyst Anshika Jain.
Apple also faced sales and import bans in the US in late 2023 and early 2024 due to a disputed patent regarding blood oxygen level monitoring, which Ms. Jain says contributed to lower sales figures in the first half of 2024.
Apple retained 22% of market share in the final three months of 2024, down from 25% a year earlier.
“We’ve been through a period where the smartwatch has gone from being a new and exciting gadget, to something now that’s stabilizing – the feature set isn’t changing very dramatically year over year,” said Leo Gebbie, principal analyst at CCS Insight.
Despite the overall decline, last year saw a significant rise in sales for Chinese-made smartwatches from brands such as Xiaomi, Huawei, and Imoo.
Xiaomi Smart Band 8 watches were released in 2023.
Sales in China grew from 19% of the market to 25% in the year from the last quarter of 2023.
This marked the first time China recorded more smartwatch sales than India or North America, according to Counterpoint.
Chinese manufacturers also tapped into the growing popularity of smartwatches for children, the only market segment to grow in 2024.
Imoo, known in China as “Little Genius,” specializes in children’s smartwatches and saw a 22% rise in shipments.
“The kids’ smartwatch segment is gaining traction as parents are concerned for their children’s safety, and they desire to track and stay constantly connected with their children,” said Counterpoint’s Balbir Singh.
However, Imoo was eclipsed by a 135% rise in shipments from Beijing-based tech company Xiaomi.
Its Smart Band activity trackers sell for a fraction of the price of rivals made by Apple and Samsung.
“We’re seeing the large consumer electronics players like Apple and Samsung really just look to drive a way higher margin and not engage in the price war,” said Mr. Gebbie. “Xiaomi has done a really good job of selling devices, particularly in regions like southern and eastern Europe where that greater affordability tends to resonate a lot more strongly with customers.”
Another significant contributor to the global sales drop was India, which fell from 30% of the market to 23%.
He said this was partly due to a “bubble” of ultra-cheap devices from Indian manufacturers that has now burst. “We read and saw a lot in terms of complaints about the quality of devices, with people being unhappy with them,” he said. “For those companies, there’s been a sense that from this point onwards they would be better served by maybe making and selling products with a slightly longer lifespan.”
Counterpoint expects a small recovery in the global market, with “single-digit percentage growth in 2025.”
The firm predicts this uptick will be driven by the increasing adoption of AI features and a greater emphasis on providing a wider range of health data.
