CEO Tim Cook says the category is now the size of a Fortune 150 company
Apple’s wearables division continues to deliver success, with Tim Cook announcing a record-breaking quarter – one which saw it generate more revenue than the Mac for the first time.
In the company’s Q4 earnings report, Cook highlighted the $10 billion the ‘Wearables, Home & Accessories’ category was able to produce, headlined by the Apple Watch and Apple AirPods.
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“Both AirPods and Apple Watch were must-have gifts, helping drive unprecedented results for the category”, Cook said.
No specific figures are ever provided by Apple in its earnings calls, meaning we don’t have the full breakdown of which devices lead the sector, but Cook did give us a couple of hints – one of them being that Apple couldn’t pump out enough models of certain devices to meet the demand over the holidays.
That’s either an insight into Apple AirPods Pro popularity, or potentially an indicator that the Apple Watch Series 3 found new success at its $199 price point, created after the arrival of the Series 5 in September.
Whatever is driving Apple’s wearables, it’s accelerating fast. Back in July, the company revealed the division’s revenue was equivalent to a Fortune 200 company – and Cook updated this after the Q4 earnings, noting that it is now providing the revenue of a Fortune 150 company.
This implies it’s generating roughly $20 billion per year for Apple, which, while still only a fraction of the iPhone’s contribution, signals domination over the industry. These figures show a 37% year-on-year growth, too.
So, what’s next? Well, it was really only a matter of time before the wearables conglomerate began challenging the Mac category in total revenue, and growth over the past year means it’s continuing to look like the company’s future second fiddle to the iPhone.
Apple, too, is still bringing in plenty of new Apple Watch buyers (75% of units shipped during Q4 were to first-time users, according to Cook) while still holding onto potentially the biggest card – Android support.
If Cook does decide to open up the company’s smartwatch at some point in the future, expect the numbers of the all-encompassing wearables division to bloat even further.