An Apple iWatch may not be a huge revenue booster but it could still capture as many as 10 million customers.
Based on a Piper Jaffray survey of 799 US consumers, analyst Gene Munster believes Apple could sell between 5 million and 10 million smartwatches during the initial launch year. The recent poll asked people whether they would buy a $350 iWatch that can connect to an iPhone.
At first glance, the survey results don’t seem to bode well. Among iPhone owners polled, only 12 percent said they’d be interested in buying an Apple iWatch, leaving 88 percent on the sidelines. On a global basis, that percentage is likely to be even lower. Still, that means anywhere from 2 percent to 4 percent of iPhone users around the world may actually buy the watch during the first year.
How would that impact Apple’s bottom line? Very little, Munster indicated in an investors note released Monday. Assuming a midpoint estimate of 7.5 million iWatch sales, Apple’s revenue and gross profits would each rise by just 1 percent. But the analyst sees other benefits from an Apple smartwatch.
“While we do not view the watch as a likely needle-mover for Apple in terms of revenue in 2014, we put it in a similar category as the television in that it could demonstrate Apple’s ability to innovate (good for the multiple) and potentially lead to a more meaningful new product category in wearable tech,” Munster said.
The analyst believes there’s a 60 percent chance Apple will unveil an iWatch in 2014.