Apple maintains lead in growing wearables market
March 19, 2019
Apple has maintained a strong lead in a wearable device market that grew 31.4% worldwide during the fourth quarter of 2018, reaching a high of 59.3 million units, according to data from International Data Corporation (IDC).
Growth in the market was driven by wearables launched during the months leading up to the holiday season as well as smartphone launches as many were bundled with wearables from leading brands.
Shipments for the entire year of 2018 grew 27.5% with 172.2 million wearables shipped. Much of this growth was attributed to the growing number of ear-worn devices as they captured almost a quarter of the market during the year.
In keeping up with current trends, IDC has recently revised its taxonomy for ear-worn devices to include wireless headphones capable of enabling smart assistants at the touch of a button or through hot-word detection. Examples of such headphones include Apple's AirPods, Google's Pixel Buds and Bose's QC35II.
"The market for ear-worn wearables has grown substantially this past year and we expect this to continue in the years to come," said Jitesh Ubrani, senior research analyst for IDC. "It is the next battleground for companies as these types of headphones become a necessity for many given the exclusion of headphone jacks from modern devices. Add to that the rise of smart assistants and in-ear biometrics and companies have the perfect formula to sell consumers on a device that's complimentary to the device ecosystem that lives on their wrist and in their pocket."
Among the various form factors available during the quarter, smartwatches grew 55.2% compared with 4Q17 and accounted for 34.3% of the overall market during the quarter. Meanwhile, wristbands accounted for 30% of the market as recent launches from Xiaomi, Huawei and Fitbit continued to drive the category forward. Ear-worn devices grew 66.4% and captured 21.9% of the market.
"Smartwatches, meanwhile, grew 54.3% and accounted for 29.8% of all wearable device shipments in 2018," said Ramon Llamas, research director for IDC. "Apple accounted for nearly half the market and followed by a long list of companies that posted double- and triple-digit growth. What resulted from this was a growing list of devices available at multiple price-points to meet the needs of a diverse market."
Apple maintained the number-one position with a 27.4% share representing 16.2 million devices shipped in 4Q18, 10.4 million of which were Apple Watches. The Series 4 has been off to a very strong start and IDC anticipates this to continue as more healthcare organisations and consumers adopt the latest device. The remainder of Apple's shipments were comprised of AirPods and Beats headphones in the ear-worn category.
Xiaomi captured the second position with 12.6% share. The company's products remain strong in its home country of China. However, recent investments in Europe and other Asian countries have paid off and helped cement Xiaomi's name as a competitive force. The Mi Band 3 alone accounted for over 30% of all wristbands shipped during the quarter.
Huawei had a great quarter in the wearables and smartphone markets. Within smartphones, the company grew 43% during the quarter in an otherwise declining market and this translated to a staggering 248.5% growth in the wearables market since many of the Huawei and Honor phones were bundled with wearables. New product launches such as the Watch GT, FreeBuds 2 Pro and a few others also helped the company gain traction.
Fitbit finally returned to growth during the holiday season as the new Charge 3, combined with promotional activity on other popular devices such as the Versa, helped the company claw back some of its market share. The company's outlook remains strong as investments in the healthcare segment continue to pay off. In the USA, Fitbit has managed to partner with providers such as Blue Cross Blue Shield, United Healthcare and others, allowing for further proliferation of its devices and services.
Rounding out the top five was Samsung with four million units shipped during the quarter. Similar to Huawei and Xiaomi, Samsung was also able to bundle many of its wearables with smartphones. The newly launched Galaxy Watch was quite well received although older models such as the Gear S3 still managed to capture a notable share of Samsung's overall shipments.