Apple Watch sales remain mystery after first quarter on the market

Apple Inc. says that sales of the new Apple Watch exceeded its own expectations for its first quarter of market availability, but won’t release a hard number in terms of units sold or revenue directly from the smart watch.

While sales of the iPhone and iPad are broken out into their own categories for quarterly revenue, Apple chose to group Apple Watch in with “other products” that also include Apple TV, Beats Electronics, iPods and accessories. That category spiked in revenue by about $950 million compared to the previous quarter, from $1.69 billion to $2.64 billion.

In Apple’s third-quarter financial report conference call with investors, CEO Tim Cook said that the launch of the Apple Watch in April was a major highlight. But he went on to admit there were delays in getting the device shipped to retail locations.

“We started taking preorders in nine countries on April 10, and demand immediately exceeded supply by a wide margin,” he says. “To prioritize those first orders and to deliver the best experience for our customers, we delayed the availability of Apple Watch in our own retail stores until mid-June.”

While Cook pointed out that Apple Watch sales were better than either the iPhone or iPad in their first quarter of sales, respectively, that comparison might not be reason for enthusiasm. The iPhone, released to the U.S. market alone in Q3 of 2007, only sold 270,000 units during that quarter, according to Statistica. Many analysts had projected sales of Apple Watch, now available in 19 markets around the world, to be in the three to four million units range.

The $950 million bump in Apple’s “other category” is the minimum amount of revenue it could have seen from the Apple Watch, since sales of its other products in the category are in decline. Still, Apple won’t say how much of a decline those other products saw in the quarter.

Whether the Apple Watch is adopted en masse or not could be an indicator as to whether the smart watch industry is going to be as large as the smartphone market. Compared to the smart watch sales of its competitors, Apple’s wearable is in another league.

There were 720,000 Android Wear devices sold from various manufacturers in 2014, according to analyst firm Canalys. Other niche players like Pebble and its smart watch have done well in terms of standards for Kickstarter campaigns, recently raising more than $20 million for its Pebble Time smart watch, but just don’t have the market reach to compete with giants like Apple.

 

 

 

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Jim Love, Chief Content Officer, IT World Canada
Brian Jackson
Brian Jacksonhttp://www.itbusiness.ca
Editorial director of IT World Canada. Covering technology as it applies to business users. Multiple COPA award winner and now judge. Paddles a canoe as much as possible.

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