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The Smartwatch Market’s First Annual Dip: What Happened and Why

The first annual smartwatch shipment decline was real, but not a universal collapse: Apple weakened, India’s budget boom corrected, and China gained ground.
From TheFinanceBase Team6 min to read
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Global smartwatch shipments fell in 2024 for the first time on record in the estimates discussed by IDC and Counterpoint—but the size of the decline depends on which tracker you use. IDC forecast a 3% drop; Counterpoint later estimated a 7% fall. Both figures describe shipments, not necessarily retail purchases, revenue, or the number of people using a smartwatch. The downturn reflects a market correction: Apple’s weaker year and India’s retreat from a boom in inexpensive devices weighed on totals, while China gained ground and some brands proved more resilient.

What “the first dip” actually means

The headline refers to full-year global smartwatch shipments in 2024. IDC forecast shipments would fall about 3% year over year, while Counterpoint’s later estimate put the decline at about 7%. The estimates are not directly interchangeable: tracking firms can use different data and category definitions. The difference is a reason to describe the downturn as real while avoiding false precision about its exact size. IDC’s forecast; Counterpoint’s 2024 estimate, reported by Wareable.

Shipments are devices sent into sales channels, not a direct count of watches bought by consumers. Inventory, launch timing and retailer stock can affect them. Nor do fewer shipments automatically mean lower revenue: a shift toward more expensive models could raise average selling prices even as unit volume falls. The figures also say nothing by themselves about the installed base, which can keep growing when people hold on to watches longer.

The decline is specific to smartwatches as tracked by these firms. It is not proof that all wearables—such as earbuds, fitness bands or smart rings—fell by the same amount, or that every smartwatch category and region contracted.

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Why shipments fell

Apple’s weaker year had an outsized effect

Counterpoint-linked reporting put Apple Watch shipments down about 19% in 2024, a major contributor to weakness in the advanced-smartwatch segment. Apple’s scale in premium watches means its performance can move the market total, but it was not the only source of weakness. MacRumors’ report citing Counterpoint.

A plausible part of the explanation is product maturity. Many owners can keep using a watch that already handles notifications, workouts, heart rate, sleep tracking and payments. If a new model mostly improves existing functions, there may be little reason to replace a recent one. This is market-cycle analysis, not a measured explanation for every buyer’s decision.

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Apple introduced the Series 10 in September 2024 with a thinner design, larger display, faster charging, depth and temperature sensing, and sleep-apnea notifications. That refresh shows continued investment in hardware and health features, but such additions do not necessarily persuade owners to upgrade every year. Apple’s Series 10 announcement.

A U.S. availability disruption added pressure

A patent dispute over blood-oxygen technology led to import and sales restrictions affecting particular Apple Watch models in the United States around the turn of 2024. That was a supply and availability disruption in one market, not a global ban on Apple Watches or proof that health tracking had stopped mattering. Its effects on shipments could include delayed, lost or redirected sales; the available figures do not establish that every affected shipment represented permanent lost demand. The dispute compounded, rather than fully explains, Apple’s annual decline.

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India’s low-cost boom was correcting

India had become a major growth engine for inexpensive smartwatch-like devices. The market filled with white-label and lightly differentiated products competing on low prices, discounts and feature lists. IDC described the market as entering consolidation after an influx of white-label devices. When that crowded segment loses momentum, it can pull down the global unit total even if premium watches or specialist sports models hold up better. IDC’s discussion of wearables and India.

Price and value became harder to balance

IDC also warned that rising smartwatch prices could make increases harder for vendors to justify. Premium devices offer better sensors, screens, materials, cellular options and software, but cost more; budget devices are accessible, yet often compete in a crowded market with little differentiation or loyalty. The result is a polarized market, not necessarily a uniform retreat from watches.

China gained ground as the market map shifted

Counterpoint-linked reporting said China became the largest regional smartwatch market by shipments in 2024, overtaking North America and India. This is a shipment ranking, not a claim that China led in revenue, active users or every wearable category. Huawei, Xiaomi and children’s-watch maker imoo benefited from a combination of local brand preference, distribution and products spanning different price points. Counterpoint later pointed to Huawei, imoo and Xiaomi as drivers of China’s growth, alongside domestic preference and government support. Wareable’s account of Counterpoint’s 2024 findings; Counterpoint’s Q1 2025 report.

These brands also address different buying priorities. Xiaomi competes across price points; Huawei emphasizes health, fitness and battery life; imoo serves parents looking for children’s communication and safety features. They are not all substitutes for a premium, app-centered watch.

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The market was uneven, not universally weak

Counterpoint’s May 2025 forecast update described declines for Apple and Samsung in the major high-level operating-system segment, while Huawei, Garmin and Xiaomi drove growth. Garmin’s specialist appeal to runners, cyclists, hikers and endurance athletes depends more on training tools and outdoor use than on an annual mass-market upgrade cycle. Children’s watches likewise serve a distinct need from adult fitness or notification watches. Counterpoint’s May 2025 forecast update.

Quarterly data also shows why an annual “market is down” label can hide changes in direction. Counterpoint reported global smartwatch shipments down 2% year over year in Q1 2025, the fifth consecutive quarterly decline in its series at that point. It then reported 4% growth in Q1 2026. In that later quarter, Apple shipments rose 21%, Xiaomi 9% and Huawei 12%, while Samsung shipments fell 28%. This is evidence of a quarterly recovery, not confirmation that full-year 2026 shipments would grow. Counterpoint Q1 2025; Counterpoint Q1 2026.

Why watches are difficult to sell every year

Smartwatches are often companion devices rather than the device people rely on for everything. A watch that still tracks activity, displays alerts and works with its owner’s phone may remain useful for years. New generations can improve sensors, battery management, screen brightness or software without changing the basic experience enough to trigger an immediate replacement. Battery wear eventually creates a reason to replace a device, but it does not set an annual schedule.

Health features remain a meaningful reason to buy, but a new feature can be more compelling to a first-time buyer than to someone who already owns a recent model. It is also important to distinguish wellness estimates and notifications from diagnosis or treatment. Apple’s sleep-apnea notifications, for example, are a health feature, not a substitute for a clinician’s diagnosis. Availability and regulatory status can vary by region and by feature. Apple’s health-features announcement.

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What the downturn means if you are buying

A market slowdown is not, by itself, a reason to avoid buying a watch. It is a reason to look past launch excitement and choose for the needs that will matter over the years you expect to keep it.

  • Start with phone compatibility. Apple Watch is primarily for iPhone users; Wear OS and other watches have model-specific platform limits. Confirm the exact phone and feature compatibility before buying.
  • Match the device to the job. A general-purpose watch, a dedicated sports watch and a children’s communication watch solve different problems. Serious training may favor GPS, workout analysis and battery life over a large app selection.
  • Check battery expectations. Compare real-world use cases, including GPS workouts and always-on displays, rather than relying only on a headline maximum.
  • Verify local health features. Health functions can depend on hardware, software, country and regulatory availability. Do not assume a feature offered in one market is available everywhere.
  • Include ongoing costs. Cellular service may require a separate plan; fitness or coaching functions may involve subscriptions. Factor these into the ownership cost.
  • Consider support and repair. Software-update duration, battery replacement and repair options affect the value of keeping a watch for several years.
  • Buy for a specific benefit. If your current watch works and the new model only offers incremental changes you will not use, waiting may be better value than upgrading on a yearly cycle.

Product prices and availability are accurate as of the date/time indicated and are subject to change. Any price and availability information displayed on Amazon at the time of purchase will apply.

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