Apple sold an incredible number of Watches over the past year

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Apple Watch is now outselling Rolex.
Photo: Jim Merithew/Cult of Mac

During Apple’s recent iPhone X keynote, CEO Tim Cook noted that Apple Watch has overtaken Rolex to become the biggest watchmaker in the world, although the company still refuses to reveal any actual sales numbers.

According to analysts at Asymco analyst Horace Dediu, Apple has likely sold around 15 million Watches in the past 12 months at an average price of around $330. Rolex, meanwhile, produces around 1 million watches a year, with average cost per watch being in the region of $4,700. Added up, that makes the Apple Watch revenue run rate $4.9 billion, compared to Rolex’s $4.7 billion.

Not bad for a device that’s been around only a couple of years, taking on a business that started in 1905!

Cannibalizing the iPhone

In total, Dediu suggests that 33 million Apple Watches have been been sold since launch and they generated about $12 billion in sales. “Coupled with a 95% customer satisfaction score, altogether, this has been a great success story,” he writes.

Dediu’s commentary on the Apple Watch also posits an interesting theory: that the Apple Watch could eventually wind up cannibalizing iPhone sales, much as the iPhone did for iPod sales. At present, he notes that — even with LTE — the Apple Watch is a companion product to the iPhone, instead of a totally standalone product.

But that could change. He writes that:

“The Watch is effectively stealing usage from the iPhone. At first it took alerts, timekeeping, and basic messaging away. Now it’s taking basic phone calls and music and maybe maps.

It’s fitting therefore to remember how the iPhone was launched; as a tentpole troika: A wide-screen iPod, an Internet Communicator and a Phone. Today the new Watch is a small-screen iPod, an Internet Communicator and a Phone.

So not only is the Series 3 Watch more powerful than the original iPhone but it is also poetically capable of the same tentpole jobs. But it’s not just a miniature iPhone. It has a new, completely orthogonal attack on non-consumption and market creation: fitness and health. This is a key point. The iPhone was born a phone but grew up to be something completely unprecedented, unforeseen by its creators and, frankly, undescribable in the language of 2007.”

Whether the wrist-based form factor can eventually take over from smartphones remains to be seen. As he notes, right now we’re at the very beginning of this journey. The iPod rapidly lost ground to the iPhone because it didn’t do anything fundamentally different for the majority of users.

The display of iPhones is, as the larger screen size of handsets shows, more important than ever to customers. It’s also going to be a long time before Apple gets the kind of FDA approval needed to turn the Apple Watch into a true medical device. With that said, Apple Watch sales right now are on par with where the iPhone was in years two and three of its life.

Do you see potential for the Apple Watch to become an iPhone-sized hit in the future? Has it had any impact on your buying decisions when it comes to smartphones? Leave your comments below.

Source: Asymco