Apple (NASDAQ:AAPL) became the top wearables maker in the world in 2017, according to research firm IDC. The Apple Watch maker finished the year with a 15.3% share of the market, up from 10.8% in 2016, as its shipments surged 56% to 17.7 million.
Apple's growth came at the expense of former market leader Fitbit, which saw its shipments drop 32% to 15.4 million. Fitbit's basic fitness trackers face tough competition from lower-end players like Xiaomi, while its higher-end trackers and smartwatches struggle to compete with the Apple Watch.
IDC notes that Apple is "catching the market at the right time" as users of basic wearable devices upgrade to smartwatches. It also notes that the addition of stand-alone cellular connectivity, which is available on select Series 3 Watches, is "earning a warm reception among end users."
It's true that 17.7 million Watches pales in comparison to the 216.8 million iPhones Apple sold last year. But the Apple Watch serves as an extension of Apple's ever-expanding ecosystem, with the integration of Siri, Apple Music, Apple Pay, Health, and other iOS apps making it an increasingly appealing accessory for iPhone owners.
Leo Sun has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Apple and FIT. The Motley Fool has the following options: long January 2020 $150 calls on Apple and short January 2020 $155 calls on Apple. The Motley Fool has a disclosure policy.