Global Smartwatch Sales Decline as Apple Faces Setbacks
For the first time, global smartwatch sales have seen a decline, signaling a shift in the once-booming market. According to market research firm Counterpoint, worldwide smartwatch shipments dropped by 7% in 2024 compared to the previous year. This decline was driven in large part by Apple’s falling sales, which saw a 19% decrease in the same period.
Apple’s Market Challenges and Declining Demand
Apple, the dominant player in the smartwatch industry, experienced a sharp downturn in demand. Analysts attribute this decline to a lack of significant upgrades in the latest Apple Watch lineup, which led to reduced consumer interest. Additionally, Apple did not release the rumored high-end Ultra 3 model, further dampening demand.
According to Anshika Jain, Senior Research Analyst at Counterpoint, North America was the biggest contributor to Apple’s sales drop. “The absence of the Ultra 3 and minimal feature upgrades in the S10 lineup led consumers to hold back purchases,” she explained.
Adding to Apple’s woes were sales and import bans in the United States, which took effect in late 2023 and early 2024. These restrictions stemmed from a patent dispute regarding blood oxygen level monitoring technology, impacting Apple’s ability to sell certain smartwatch models.
Despite these challenges, Apple managed to retain its position as the leading smartwatch brand. However, its global market share shrank from 25% in late 2023 to 22% by the end of 2024.
Market Saturation and Changing Consumer Trends
Industry analysts suggest that the smartwatch market is reaching a saturation point, with fewer groundbreaking innovations driving consumer interest. Leo Gebbie, Principal Analyst at CCS Insight, noted this shift:
“We’ve seen the smartwatch transition from an exciting new gadget to a stable product category. The feature set isn’t changing dramatically year over year, which has impacted demand.”
While premium brands struggled, the market saw a surge in demand for budget-friendly smartwatches, particularly from Chinese manufacturers.
China Surpasses North America and India in Smartwatch Sales
One of the biggest shifts in the smartwatch industry occurred in China, which emerged as the top smartwatch market in 2024. Chinese smartwatch sales rose from 19% to 25% of the global market, surpassing India and North America for the first time.
This growth was driven by rising demand for affordable smartwatches and kids’ smartwatches, a segment that was the only one to experience growth in 2024.
Imoo, known in China as “Little Genius”, capitalized on this trend by focusing on smartwatches designed for children. The brand recorded a 22% increase in shipments, as parents sought child-tracking and safety features in wearable devices.
“The kids’ smartwatch segment is gaining traction as parents look for ways to stay connected with their children and ensure their safety,” explained Balbir Singh, an analyst at Counterpoint.
However, Xiaomi outperformed all competitors, recording a 135% surge in smartwatch shipments in 2024. The company’s Smart Band activity trackers, which are significantly cheaper than Apple and Samsung smartwatches, gained traction in markets such as Southern and Eastern Europe, where affordability is a key purchasing factor.
“Xiaomi has done an excellent job of selling devices in price-sensitive regions where consumers prioritize affordability,” said Leo Gebbie.
India’s Smartwatch Market Declines Amid Quality Concerns
While China’s smartwatch market thrived, India’s smartwatch sector experienced a steep decline. India’s market share fell from 30% in 2023 to 23% in 2024, significantly contributing to the overall global decline in sales.
This drop is partly due to an oversupply of ultra-cheap smartwatch models in previous years, which created a short-lived demand spike. However, many consumers expressed dissatisfaction with the quality and durability of these budget-friendly devices, leading to a sharp decline in sales.
“We saw a bubble in ultra-cheap smartwatches from Indian manufacturers, but complaints about product quality have caused demand to fall,” Gebbie explained.
As a result, Indian smartwatch brands are now shifting their focus to higher-quality, longer-lasting products in an effort to restore consumer trust.
Outlook for the Smartwatch Industry in 2025
Despite the 2024 decline, Counterpoint predicts a modest recovery in global smartwatch sales in 2025, expecting single-digit percentage growth.
Several factors are expected to drive this rebound, including:
- The growing adoption of AI-powered features, which will enhance smartwatch functionality.
- An increased focus on health-tracking innovations, providing users with advanced biometric data.
- Competitive pricing strategies from budget-friendly brands, making smartwatches more accessible to consumers.
While the smartwatch industry may no longer be experiencing explosive growth, brands that successfully integrate AI, prioritize health-focused features, and offer value-driven pricing are expected to thrive in the evolving market.
