Fitbit is growing faster than Apple
The global smartwatch market continues to expand, and the contest to dominate the market is shaping up to be a two-horse race between Fitbit (FIT) and Apple (AAPL), with Apple currently in the lead. Global smartwatch shipments increased 37% YoY (year-over-year) in the second quarter, according to Counterpoint data.
While Apple held 41% of the global smartwatch market in the second quarter—more than twice as much as Fitbit—it was Fitbit that recorded the fastest growth among the top three smartwatch vendors in the quarter. Fitbit exited the second quarter with 21% of the global smartwatch market, meaning its share increased more than 160% from 8.0% a year ago. In contrast, Apple’s share of the global smartwatch market fell from 48% a year ago.
Samsung releases a new smartwatch
Fossil (FOSL) captured 4.0% of the smartwatch market in the second quarter, while Garmin (GRMN) picked up 3.0% of the market in the period. Samsung (SSNLF) took 2.0% of the global smartwatch market in the second quarter. A new Samsung smartwatch brand called the Galaxy Watch went on sale last month. The Galaxy Watch may help Samsung capture a larger market share.
With its dominant market share, Apple has a lot at stake as competition in the smartwatch market heats up. Google (GOOGL) is also widely expected to launch its own smartwatch brand to compete with Apple and Fitbit.
Buyers opt for cheaper watches
The way people are selecting smartwatches to buy from the available options also looks favorable for Fitbit in its battle with Apple for market share. Smartwatch buyers are opting for cheaper devices, according to Counterpoint data that showed the Apple Watch Series 1, the Fitbit Versa, and the Amazfit as the top three best-selling smartwatch brands in the second quarter. All three brands cost less than $300, with the Fitbit Versa and Amazfit being significantly cheaper than the Apple Watch.
Apple’s newer smartwatch brands, such as the Apple Watch Series 3, are more expensive. Customers’ preference for cheaper watches may favor Fitbit given its lower watch prices.