Toronto Star

Is Apple Watch out of time?

Sales of device were off to a flying start, but firm’s revenues have seen a downturn in recent reports

- GEOFFREY VENDEVILLE STAFF REPORTER

Is time already up for the Apple Watch?

Apple, the world’s most valuable company, is the leader in the smartwatch category, but falling product sales have raised questions about the wrist-worn gadget’s future.

Apple doesn’t break out sales numbers for the Apple Watch, but the company posted an overall decline in revenue of about 15 per cent in the three months leading up to June 25 — the second consecutiv­e quarter of falling sales.

In an independen­t assessment, research firm IDC reports that sales of the Apple Watch, which was launched in April last year, have plunged to1.6 million in the second quarter of 2016. That’s a 55-per-cent drop compared with a year earlier.

But Manish Nargas, a research analyst with IDC Canada, says it’s too early to draw conclusion­s about the first Apple product since the iPad.

“I don’t think you should see Apple smartwatch sales slowing down right now as an indication that the market is in trouble,” he said.

In its first year, Apple sold twice as many smartwatch­es as it did iPhones in the first 12 months after that device’s introducti­on, according to The Wall Street Journal.

About 12 million smartwatch­es were sold in its debut year, the Journal said.

A slump in sales is normal after enthusiasm surroundin­g a product’s unveiling has faded, Nargas said.

He added that consumers may also be hesitant to splurge on an Apple watch when other companies — in- cluding traditiona­l watchmaker­s such as Casio and Fossil — are still getting into the game.

Overall, smartwatch sales sank by 32 per cent over the last year, according to IDC.

“We believe smartwatch manufactur­ers still have to find that sweet spot between functional­ity and price right now,” Nargas said.

The cheapest Apple Watch, a model called the Sport, sells for about $400 and up.

The California­n research firm J.D. Power reported this month that the Apple Watch ranks highest in customer satisfacti­on, a nose ahead of the competitio­n.

On a 1,000-point scale based on ease of use, comfort, battery life and other factors, the Apple Watch finished with a score of 852.

Samsung had earned a final score of 842.

 ?? ROBYN BECK/AFP/GETTY IMAGES ?? IDC reports that sales of the Apple Watch, which was launched in April last year, have plunged to 1.6 million.
ROBYN BECK/AFP/GETTY IMAGES IDC reports that sales of the Apple Watch, which was launched in April last year, have plunged to 1.6 million.
 ?? KOJI SASAHARA/THE ASSOCIATED PRESS ?? Apple, maker of the Apple Watch, posted an overall decline in revenue of about 15 per cent in three months.
KOJI SASAHARA/THE ASSOCIATED PRESS Apple, maker of the Apple Watch, posted an overall decline in revenue of about 15 per cent in three months.

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