All hail the Apple Watch. Source: Apple

After what's been an almost agonizing amount of time, Apple's (AAPL 0.16%) hugely anticipated Watch officially goes on sale this weekend.

Of course skeptics remain about the overall value proposition of this first generation Apple Watch, myself included. However, these lingering doubts, justified or not, are unlikely to slow what appears to be the Apple Watch's initial momentum. Because if one analyst is to be believe, the Apple Watch is already the most popular smartwatch ever, even before a single unit has shipped.

Inside this amazing Apple Watch figure
According to well-regarded Taiwan-based analyst Ming-Chi Kuo, the Apple Watch has already racked up an astounding 2.3 million sales during its presale window. For those unfamiliar with him, Kuo has covered Apple for years and has established a largely positive reputation for eeking out Apple product details from sources within its massive East Asian supply chain. It's worth reiterating the estimate shouldn't be taken as Gospel truth, as is always the case. However, Kuo's track record features enough correct predictions regarding various Apple devices that this figure is certainly worth noting.

So, how did Kuo arrive at this figure?

Kuo's game is largely to gain insights into Apple's manufacturing value-chain as a means of predicting how many devices it will sell in any given period. As production has increased in the run-up to the Apple Watch's launch, Kuo estimates that Apple's third-party manufacturing partners have the capacity to produce at least 2.3 million Watches from March to May, a figure that will increase as production bottlenecks dissipate in the coming months. Comparing that current production capacity versus the established fact that Apple sold out its total number of presales units in just six hours, this implies Apple sold through that entire 2.3 million in production, if not more. It's also worth noting this figure sits far higher than the 1 million first-day U.S. preorder estimate researcher Slice Intelligence claimed, but that seems understandable as Slice's figure fails to account for international orders. Either way, if this figure ultimately proves accurate, the Apple Watch will be a truly historic device for Apple in several ways.

Rarified air
In fact, Kuo's 2.3 million Apple Watch preorders give the Apple Watch two very impressive titles before a single device is shipped.

First, in terms of the global smartwatch market, 2.3 million shipments would make the Apple Watch the most popular smartwatch ever before its even released. For all of 2014, researcher Canalys estimated the global market for Android Wear smartwatches generated around 720,000 total sales. Even after a round of recent price cuts ahead of the Apple Watch's debut, it's unlikely any Android Wear OEM has generated significant enough sales volumes this to surpass the 2.3 million Apple Watch estimate. Similarly, Pebble disclosed it has sold over 1 million smartwatches in February. And while respectable, it still pales in comparison to Kuo's 2.3 million Apple Watch figure.

Perhaps even more noteworthy from a historical perspective, Kuo's 2.3 million Apple Watch shipments would make the Watch Apple's fastest-ever selling device by a wide margin.




Apple Watch (est.)

Apple Device First Day Sales



 > 1 Million

Time to 1 Million Sales

74 Days

28 Days

< 6 Hours

Sources: The Verge, Slice Intelligence. * denotes 30 hours, not 24

Now, this is obviously impressive feat for the Apple Watch. But it's important for investors to understand this figure in its proper context. The iPhone and iPad, albeit to a somewhat lesser extent, didn't have the same installed base of loyal customers on which to draw as the Apple Watch. Just to give you an idea of the inherent sales advantage the Apple Watch enjoys, analysts have pegged the current installed base of iPhone users as higher than 400 million. In fact, many of the analyses of the Apple Watch's long-term sales potential have focused on understanding what percentage of the iPhone's installed base the Apple Watch might capture. Of course, this is in part because the Watch is reliant on the iPhone to fully function. But having 400 million potential willing buyers already on the market is an enviable advantage for any new device. Few doubt the Apple Watch will be a hit of historic proportions. However, it's equally critical to for investors to understand the how and why behind the Watch's likely unique success as well.