Apple ( AAPL Quick Quote AAPL - Free Report) has been strengthening its footprint in the smartwatch space, thanks to its initiatives to integrate healthcare features like blood oxygen and Cycle Tracking. The company is now rumored to develop a faster Watch model for this year, per Bloomberg. This Zacks Rank #2 (Buy) company is likely to speed up the processor, improve wireless connectivity and use a thinner display bezel in this year’s upcoming model, Watch 7. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. The model is also expected to include updated ultra-wideband functionality, which Apple introduced with Watch 6. Future models are expected to include body temperature as well as blood sugar sensor. While the body temperature feature is expected to be added to the Watch model for 2022, the blood sugar sensor, which will help users monitor their glucose levels, is not expected to be available in the near term. Markedly, Apple Watch’s adoption rate continues to grow rapidly. Notably, more than 75% of customers who purchased Apple Watch in the fiscal second quarter were first-time customers. Wearables, Home and Accessories sales increased 24.7% year over year to $7.84 billion and accounted for 8.7% of total sales in second-quarter fiscal 2021. Health Care Features to Aid Apple Win Market Share
According to the IDC data, global shipments of wearables
increased 34.4% year over year to 104.6 million in the first quarter of 2021. Apple’s wearable shipments were the highest at 30.1 million, up 19.8% year over year, driven by strong adoption of Apple Watch SE and Series 3. Moreover, Apple’s market share of 28.8% was much higher than the combined market share of Samsung and Xiaomi, which grabbed the second and third positions, respectively. Apple’s endeavor to add healthcare features to its smartwatch has been a game changer for the device that faces significant competition from the likes of Garmin ( GRMN Quick Quote GRMN - Free Report) , Alphabet ( GOOGL Quick Quote GOOGL - Free Report) , Sony , Xiaomi, Samsung Electronics and Huawei Technologies. Markedly, per Gartner’s projections, global user spending on wearable devices will increase 18.1% year over year to $81.5 billion in 2021, driven by strong demand for smartwatches and ear-worn devices. Apple is well-poised to tap into this opportunity, thanks to its expanding healthcare features in smartwatch. Currently, Apple Watch includes features to monitor heart rate and irregular rhythm. The device notifies users about unusually high or low heart rates. Moreover, irregular rhythm suggests atrial fibrillation (AFib), which the smartwatch can detect with the help of optical heart sensor. Moreover, Apple Watch’s updated ECG app with additional rhythm classification has received clearance for users of 22 years or older. Also, Apple’s latest Watch models (4 or later), along with the iPhone, offer mobility and cardio fitness tools. These devices also offer fall detection alert, which is automatically enabled for users of 55 years and older and can be turned on for anyone in the Apple Watch app on the iPhone. Further, with Apple Watch 6, the company introduced a Blood Oxygen app that can measure the blood oxygen level. Additionally, the company’s Fitness+ subscription service, built on Apple Watch, has been a game changer. Fitness+ tracks health- and workout-related data from Apple Watch that users can view on their iPhones, iPads or Apple TVs. Notably, Apple Watch’s upcoming extreme sports model (likely to be available in 2022) is expected to further boost adoption. Zacks' Top Picks to Cash in on Artificial Intelligence
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