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Analysts have speculated that Apple Watch sales may have dropped 90 per cent since launch week
Analysts have speculated that Apple Watch sales may have dropped 90 per cent since launch week

Apple remains mum amid poor watch sale rumours

Apple’s decision to withhold exact sales figures for the Apple Watch has led to speculation that the high-profile smartwatch may not have performed as well as expected.

The technology giant’s financial results for the third quarter ended 27 June 2015 notably lacked distinct sales details for the Apple Watch, despite the fact that the device’s launch in April this year was described by company CEO Tim Cook as a “major highlight of the past quarter”.

Tim Cook, Apple CEO
Tim Cook, Apple CEO

Revenue for the smartwatch was grouped into the ‘other products’ category along with the iPod, Beats Electronics – a streaming music service and audio equipment business Apple acquired in May last year – and other Apple accessories.

The category achieved US$2.6 billion (AU$3.6 b), a 49 per cent increase compared to the previous corresponding period’s US$1.8 billion (AU$2.5 b).

Apple senior vice president and chief financial officer Luca Maestri explained in a financial results conference call that the company did not want to “provide insight that could help our competitors” by posting details of the smartwatch’s exact sales.

However, he noted, “the contribution from Apple Watch accounted for well over 100 per cent of the growth of the [other products] category”.

Conflicting analysis
Luca Maestri, Apple senior vice president and chief financial officer
Luca Maestri, Apple senior vice president and chief financial officer

Cook was also quick to defend the smartwatch’s performance during the conference call, stating that revenue for the Apple Watch, among other products, had “topped our internal expectations”.

This seemingly contradicted statistics reportedly released by US-based market analyst Slice Intelligence, which indicated that US sales of the Apple Watch had declined 90 per cent since the first week of its launch. Additionally, units sold in the US were said to have dropped from about 35,000 watches per day in April to less than 5,000 watches per day in July.

“[Our] June sales were higher than April or May,” Cook insisted. “I realise that’s very different [to what is being written] but the June sales were the highest. [Through] the end of the quarter, in fact, the Apple Watch sell-through was higher than the comparable launch periods of the original iPhone or the original iPad.”

Dominating the market

Meanwhile, a recent study by US research and consulting company Strategy Analytics provided a global perspective on Apple Watch sales, which supported Cook’s claims that the smartwatch was performing well.

The report stated that global smartwatch orders had reached a record five million units in the second quarter of 2015, and that the Apple Watch had dominated in terms of market share.

“We estimate Apple Watch shipped four million units and captured a dominant 75 per cent smartwatch market share worldwide in Q2 2015,” Strategy Analytics executive director Neil Mawston said. “Apple Watch has clearly raised the bar for the global smartwatch industry. The ball is now in the court of rivals, like Samsung, to respond.”

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