Wearables remain in a slump as global market continues to face lingering challenges

The big picture: Global shipments of wearables dipped 6.9 percent year over year in the second quarter as the market continues to struggle with growth. According to International Data Corporation (IDC), wearables shipments reached 107.4 million units in the three-month period ending June 30. While the top five players in the market – Apple, Samsung, Xiaomi, Huawei and Imagine Marketing– have not changed, four of the five did experience year-over-year declines during Q2.

IDC believes slowing demand is a result of a combination of factors including fear surrounding recession, rising inflation, increased consumer spending in non-tech categories and coming down from record growth over the last two years.

As such, IDC has updated its full-year shipments forecast. The market research firm now anticipates growth to remain flat at 535.5 million units through the end of 2022.

IDC research manager Jitesh Ubrani said it’s unfortunate that heavyweights like Apple, Samsung and Google are focusing on premium smartwatches at a time when consumers’ appetite for higher-priced products remains in question.

Earlier this month, Apple announced a premium version of its Apple Watch for outdoor enthusiasts. The Apple Watch Ultra packs a number of features that haven’t previously shipped in Series watches but starts at a significantly higher price tag of $799. Samsung’s top-of-the-line Galaxy Watch 5 Pro Golf Edition starts at $499.

The wearables market may be down, but it isn’t out according to research director Ramon T. Llamas. As the market continues to mature, Llamas expects the gap between the record-breaking volumes seen during the pandemic and what we see currently to level out. Overall, growth will continue albeit at a slower pace.

IDC now anticipates growth to return in 2023 as the demand for watches and hearables ratchets up due to shoppers in mature markets replacing older products and new buyers in emerging markets purchasing their first wearables.

Have you jumped on the wearables bandwagon yet? If so, what devices are you currently using and do you plan to upgrade them within the coming year?

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