The wearable technology market is growing fast. More than 72 million wearable devices shipped worldwide in 2015 and that number is forecast to spike to 155 million by 2019, according to IDC.
Many technology companies are already moving into the wearable segment, but some are doing it better than others. Below are three companies that are poised to benefit from wearable tech growth in 2016 and beyond.
The smartwatch leader
Apple (NASDAQ:AAPL) is still a newbie in the wearable tech world, but it is nearly dominating in the market already. In 2015, the company shipped more wearable devices than any other tech company, save for Fitbit.
The Apple Watch skyrocketed almost immediately to the top of the smartwatch segment, and now has a 74% market share -- and it's not expected to slow down any time soon.
According to Tractica, the Apple Watch will hold more than half of the smartwatch market share for the next four years at least, and Apple will likely make some huge gains on Fitbit in 2016.
While Apple may see slowing growth in iPhone sales in the coming quarters, its wearable tech pursuits are just getting started.
The under-the-radar play
The wearable tech market isn't an exclusive for technology companies, and Under Armour (NYSE:UAA) is proving that. It debuted several wearable tech devices at the Consumer Electronics Show in 2016, including smart shoes, a chest-worn heart-rate monitor, a fitness band, a smart scale, and an app to connect them all together.
Over the past year, Under Armour purchased MapMyFitness, Endomondo, and MyFitnessPal, for a total of $710 million, to launch its wearable tech ambitions. It's a big bet for the fitness clothing maker to jump into wearable technology, but the scale of those acquisitions shows just how serious UA is about the market. Under Armour's new Health Box (which includes the fitness band, scale, and chest strap) is already available for purchase, as are the company's smart shoes.
Under Armour isn't yet a leader in the wearables space by any means, but I think its wearable tech lineup and strong brand could turn the company into a serious player in 2016.
The hidden wearable tech play
There are plenty of companies that don't make wearable consumer devices, but that do make the tech that goes inside those devices. NXP Semiconductor NV (NASDAQ:NXPI) is one such company.
NXP has its hands in a lot of different technologies, but what makes it a wearables play are the near field communication (NFC) chips it makes for Apple's iPhones and Apple Watch. Those chips are the hardware backbone behind Apple Pay, the company's mobile payment system used at point-of-sale payment terminals.
NFC is expected to become more prominent in the wearable tech industry as other companies adopt it for their own payment systems. Samsung and Alphabet's Google already have mobile payment systems, and wearable payments are about to take off. More than $3 billion worth of transactions were made using wearable devices in 2015, according to Tractica. And that number is expected to grow to $500 billion by 2020. NXP is in a position to benefit because nearly all of those transactions will be fueled by NFC-enabled wearable devices.
Of course, NXP isn't only betting on wearable tech. The company recently closed its acquisition of Freescale Semiconductor, which makes it the largest chip provider for the automotive market. But I think as NFC technology gains more traction in the wearables market, the company is in a great position to benefit.
While none of these companies are sure bets, I think each has its own distinct advantages in the wearable tech space that could prove beneficial this year, and down the road.
Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool's board of directors. Chris Neiger has no position in any stocks mentioned. The Motley Fool owns shares of and recommends Alphabet (A shares), Alphabet (C shares), Apple, NXP Semiconductors, and Under Armour. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.