Wearables market grows as price drops; Fitbit leads

Wearable devices such as Fitbit and Jawbone scored their eighth-straight quarter of growth as more consumers become eager to track their daily activities, whether it’s how well they sleep or how many calories they burn.

Research firm IDC reported on Wednesday that, during the first quarter of the year, a total of 11.4 million wearable devices shipped around the world, triple the 3.8 million shipped during the same quarter in 2014.

The second quarter is bound to show an even more significant jump, as it will include shipments of the Apple Watch, which became available to consumers early April.

To be sure, demand for wearables is on the rise among consumers outside of the tech world and in emerging markets, as easy-to-use devices like the Fitbit — which has the dominant market share — have become popular gifts and accessories. But IDC attributed the latest surge in growth in part to lower prices.

“As with any young market, price erosion has been quite drastic,” Jitesh Ubrani, senior research analyst for IDC Worldwide Mobile Device Trackers, said in a news release. “We now see over 40 percent of the devices priced under $100, and that’s one reason why the top five vendors have been able to grow their dominance from two-thirds of the market in the first quarter of last year to three-quarters this quarter.”

The Apple Watch is an exception to the lower-price trend. The Watch starts at $349 and goes up to about $17,000 for top-of-the-line models.

Leading the way is Fitbit, which has 34 percent of the wearables market, according to IDC. That’s a slight dip from last year’s 45 percent, but more competitors have entered the market since. Fitbit shipments grew a whopping 129 percent from 1.7 million in the first quarter of 2014 to 3.9 million in the first quarter of this year.

Fitbit will soon be the first wearables company to go public, with an initial public offering expected within two weeks. And it is expected to be a monster IPO — the company on Tuesday said it will seek $14 to $16 apiece for nearly 30 million shares; at the top end of that range, Fitbit’s IPO would take in $477.6 million at a valuation of $3.28 billion. That would make Fitbit a larger deal than both GoPro, the second-largest consumer electronics debut, and Duracell, the largest deal of its kind. GoPro raised $427.2 million in its debut in June 2014, and Duracell raised $433 million in 1991, according to Dealogic.

Photo from Fitbit

 

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  • michaelfkelly

    ‘..Fitbit,
    which has 34 percent of the wearables market, according to IDC. That’s a slight
    dip from last year’s 45 percent .

 
 
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