TECH STOCKS: Apple Has Failed To Prove The Usefulness Of Smartwatches
January 30 2016 - 3:34PM
Dow Jones News
By Jennifer Booton, MarketWatch
They're not something 'consumers seem to register as a need,'
says an analyst
Apple Inc. has been known for creating entirely new product
categories. But that hasn't been the case with the Apple Watch,
Juniper Research analyst James Moar said in a post
(http://www.juniperresearch.com/analystxpress/january-2016/whither-smartwatches-apple-brings-presence-but-not).
While Apple (AAPL) shipped 3.9 million so-called wearables in
the third quarter, giving it a 19% market share versus Fitbit's
(FIT) 22%, according to the most recent data from industry tracker
IDC, Moar said consumers simply don't see a need for a
smartwatch.
And that means the market for such gadgets "still doesn't know
its overall direction," he said.
Of the consumers in a recent Juniper Research survey who
indicated they don't plan to buy a smartwatch in the next six
months, 30% said it was because they didn't think they'd use the
device.
"This is not something that many consumers seem to register as a
need," Moar said.
Read:Have we reached peak Fitbit?
(http://www.marketwatch.com/story/are-fitness-trackers-a-fad-2016-01-26)
Shares of Fitbit and Apple have taken a beating in recent
months. Fitbit's stock has plunged 62% in the past six months, and
Apple's has dropped 21%.
Fitness tracking has turned out to be the best use for
wearables, prompting Fitbit to introduce its own smartwatch-like
band called the Blaze earlier this month.
While Apple doesn't break out watch numbers in its earnings
reports, CEO Tim Cook said there were record sales in its fiscal
first quarter, which ended Dec. 26. Still, the iPhone, iPad and Mac
computers account for 86% of Apple's revenue
(http://images.apple.com/pr/pdf/q1fy16datasum.pdf).
Fitbit will report its holiday-quarter earnings Monday.
(END) Dow Jones Newswires
January 30, 2016 15:19 ET (20:19 GMT)
Copyright (c) 2016 Dow Jones & Company, Inc.
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