Apple is the sole smartwatch vendor in the top five to experience an annual decline in shipments, selling just 1.6 million wearable devices
Sales of smartwatches such as the Apple Watch and Samsung’s Gear 2 have plummeted 32 percent, and smartwatch vendors only manage to ship 3.5 million devices in the second quarter of 2016.
This is according to IDC, which said that sales are substantially down from the 5.1 million devices sold for the same quarter in 2015.
Apple Watch sales fared the worst, with the iPhone maker being the only smartwatch vendor in the top five to experience an annual decline in shipments, selling just 1.6 million wearable devices.
Room for improvement
IDC said consumers are holding off on smartwatch purchases until the software and hardware they use gets better. Smartwatches have continually come under fire over the past few years for having poor battery life and buggy operating systems.
“Consumers have held off on smartwatch purchases since early 2016 in anticipation of a hardware refresh, and improvements in WatchOS are not expected until later this year, effectively stalling existing Apple Watch sales,” said Jitesh Ubrani, research analyst for IDC Mobile Device Trackers.
“Apple still maintains a significant lead in the market and unfortunately a decline for Apple leads to a decline in the entire market. Every vendor faces similar challenges related to fashion and functionality, and though we expect improvements next year, growth in the remainder of 2016 will likely be muted.”
As for Apple’s main trival, Samsung, IDC said that it’s done well with North American distribution through telcos, and the Gear S2 is off “to a great start”.
“Focusing on the telco channel to drive future success in telco-driven markets is likely to remain the core strategy for Samsung moving forward,” said IDC.
Over in Lenovo’s camp, being the first vendor to sell smartwatches with the Motorola brand is still paying off, thinks IDC.
“It continues to be the smartwatch of choice for those interested in Android Wear-based circular displays,” IDC said.
Ramon T. Llamas, research manager for IDC’s Wearables team, commented: “What will bear close observation is how the smarwatch market evolves from here.
“Continued platform development, cellular connectivity, and an increasing number of applications all point to a smartwatch market that will be constantly changing. These will appeal to a broader market, ultimately leading to a growing market.”
IDC said it does expect to see the market return to growth in 2017.