Apple Watch Sales Nearly Impossible To Predict - InformationWeek

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IoT
IoT
Mobile // Mobile Devices
Commentary
7/21/2015
02:05 PM
Eric Zeman
Eric Zeman
Commentary
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Apple Watch Sales Nearly Impossible To Predict

Apple reports its quarterly earnings July 21. There's lots of interest in determining just how many Apple Watches the company has sold.

10 Cool Fitness Trackers That Aren't Apple Watch
10 Cool Fitness Trackers That Aren't Apple Watch
(Click image for larger view and slideshow.)

Estimates for sales of the Apple Watch are all over the place. It is a hit? A failure? A slow burner? Apple probably won't let us know, but we can certainly entertain some educated guesses.

Analyst firm estimates of Apple Watch sales range from 2.85 million to 5.7 million. Financial Alchemist's Turley Muller fielded the lowest estimate, and Jeffries's Sundeep Bajikar was the most bullish. Perhaps most interestingly, Gene Munster, the perennial bull on everything Apple, thinks the company has sold about three million watches -- one of the more conservative estimates.

Back in April, Slice Intelligence suggested first weekend sales of the wearable were about 1.7 million. In June, Reuters placed sales at about 2.8 million after two months.

Apple reports its third quarter earnings today, July 21, and a lot of people hope that the company will reveal how many it has sold, so we can put the guessing to a stop. Don't get your hopes up.

"Apple almost certainly won't give us the number of Watches sold, and estimating that number requires making a series of assumptions, which taken together make the resulting number pretty imprecise," writes Jan Dawson from Jackdaw Research. "Whatever the number various people come up with, we'll be deluged with articles saying that the Watch has somehow flopped, that sales have fallen short of expectations, and so on, because it's enormously difficult to know how to evaluate the number."

The number will be buried in the "Other Products" section of Apple's earnings.

(Image: mtreasure/iStockphoto)

(Image: mtreasure/iStockphoto)

Lots of Apple things fall into this category, which also covers the iPod, Apple-made accessories, third-party accessories, and the Apple TV. Revenues for "Other Products" reached $1.7 billion last quarter, which was down 10% year-over-year. Dawson says this category has been notoriously unpredictable over the years and isn't a steady barometer against which to measure potential Apple Watch sales.

Inquisitive analysts will surely ask Apple CEO Tim Cook directly during the company's call to discuss its financials. Knowing Cook, we're likely to get a statement like: "We're really pleased with sales of the Apple Watch so far."

Do sales of the Apple Watch really matter?

Believe it or not, Apple was rather late to the smartwatch market. Pebble beat it by nearly two years. Samsung trotted out the Galaxy Gear smartwatch line beginning in October 2013. Even Android Wear reached the market nine months before the Apple Watch rolled out.

[Read about why HTC is delaying its Grip wearable.]

Smartwatches accounted for a small blip in the greater wearables segment. Wearable makers shipped 11.4 million devices during the first quarter, according to IDC. Fitness bands from the likes of FitBIt accounted for 75% of all wearables shipped in that period. That means Samsung, Pebble, Motorola, LG, and others shipped just 2.8 million smartwatches.

Could Apple have surpassed that with its first wearable product? Possibly.

Whether or not the Apple Watch is deemed a success or failure, its first quarter of sales is a gauge for assessing the larger market for smartwatches. The segment is still in its early days, and many have written smartwatches off as an unnecessary piece of tech that doesn't solve any real problems.

However many Watches Apple sold, the number probably exceeds that of competing devices.

Eric is a freelance writer for InformationWeek specializing in mobile technologies. View Full Bio
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jastroff
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jastroff,
User Rank: Ninja
7/21/2015 | 4:58:04 PM
What's the Number 1 Selling Wearable?
@eric - What's the number 1 selling wearable? Isn't it the Apple Watch?

 

 
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