Apple's dominance in the growing smartwatch market has remained consistent this year, despite the negative impact of COVID-19 on many areas of consumer spending.
In a new report, Strategy Analytics estimated that global smartwatch shipments grew 20% year-over-year in the March quarter to 14 million, with the Apple Watch accounting for 7.6 million of those shipments. Shares of Apple (AAPL) - Get Report rose 1.1% on Thursday to $303.96.
"Apple’s global smartwatch marketshare has grown from 54 percent to 55 percent, its highest level for two years," said Neil Mawston, executive director at Strategy Analytics. "Apple Watch continues to fend off strong competition from hungry rivals like (GRMN) - Get Report and Samsung (SSNLF) . Apple Watch owns half the worldwide smartwatch market and remains the clear industry leader.”
The current quarter is likely to look much different, however, given the greater overlap with COVID-19 economic disruptions.
Strategy Analytics expects smartwatch sales to fall sharply this quarter as a result of lockdowns and store closures, followed by a partial rebound in the second half of this year. But the long-term prospects for the market remain "excellent," according to the research firm.
On an earnings call with shareholders last week, Apple executives cautioned that iPhone and smartwatch sales will likely worsen in the current quarter. Sales of iPads and MacBooks will improve, however, owing to the current stay-at-home environment.
Apple CEO Tim Cook hinted at plans to expand the Apple Watch's health-related feature set.
"You can bet that we’re looking at other areas in this. We were already doing that because we viewed that that area was a huge opportunity for the company and a way for us to help a lot of people. And so you will see us continue on that," he said.
For its overall wearables, home, and accessories segment, Apple reported revenue of $6.3 billion, up 23% year-over-year, for the March quarter. It did not issue specific financial guidance for the current quarter, and pulled its full-year outlook as well.
Apple shares have risen 1% year to date.