Fitbit Inc (NYSE:FIT) and Apple Inc (NASDAQ:AAPL) watch are not expected to perform any better, rather the performance is expected to decline further.
Declining demand for wearable devices
The wearable devices experienced a big slump in interest last year. Analysts do not expect the growth rates to increase much in the next couple of years. Last year about 73 million wearable devices were acquired according to Research by Forrester. These include everything ranging from the cheapest fitness trackers designed by Xiaomi and Fitbit to the most expensive smart watches designed by Apple and Garmin.
Forging forward, the wearable devices in use will increase about 14% per year in the next five years. By the year 2022 the devices use is expected to hit the 189 million mark. The value of sold devices will increase by 9% per year to $9.1 million by 2022 from $4.8 million in the year 2026.
Researchers have been generally, tamping down the previous very high expectations for the wearable devices market. The latest prediction by Forrester for the year 2022 is currently below the previous $9.8 million expectation which was issued last year. Emarketer also lowered their prediction recently.
Future plans by the companies
Fitbit is the poster child in the wearable devices market’s growth rate. The company’s stock has lost about 68% in the past year as it strained with production challenges, declining sales, layoffs as well as changes in executives. The company is planning to launch its own new smart watch during the second half of the year.
Apple narrowed its focus on the smart watch last year to concentrate more on health and fitness qualities. The company is however, in the process of designing a wide platform which can run apps, run Siri digital voice assistant and make payments.
In a report accompanying the prediction, Shaurya Priya, the Forrester analyst notes, “That’s the right strategy as smart watches will increasingly eclipse more limited function wearables like fitness trackers.” Watch software by Apple, Alphabet Inc (NASDAQ:GOOGL) and other players is improving in meeting the needs of consumers and it is expected to include all the fitness tracking functions provided by simpler devices.
Fitbit stock closed in at $5.37 on Thursday after a fall $0.11 or 2.02% while Apple closed in at $141.05 after a fall $0.75 or 0.53%.
