Health IT

Wearables are second biggest revenue driver for Apple 3 years after they were introduced

Apple highlighted its wearable muscle on the first quarter conference call.

Last September, Apple pulled back the curtain on some of its healthcare upgrades More recently it has rolled out a pilot program for its health app supporting health record access. So as the health capabilities for Apple’s iPhone and smartwatch build, it’s interesting that after only a few years, wearables are the second largest revenue driver, according to CEO Tim Cook on Apple’s first quarter earnings call.

Apple had sales of $88.2 million with net income of $20 million for the last three months of 2017. That compared with $78.3 million for the same period in 2016.

Apple’s smartwatch had its best quarter ever and gained significant marketshare, according to CEO Tim Cook citing IDC. Apple’s wearables were also strong in China.

Some companies have worked to develop their technology with Apple smartwatches. Last fall, AliveCore secured FDA clearance for an EKG tool for Apple’s smartwatch that’s designed to flag atrial fibrillation.

Cedars Sinai rolled out an Apple smartwatch app that allows users to manage their medical records, connect with their care team and search for a doctor by name, condition or specialty.

Speaking of apps, app store revenue reached a new record and was twice that of Google Play, Cook said. Quarterly visitors also reached a high.

But Apple is ever searching for more customers, particularly more efficient ways of getting them. It has rolled out a new program to do that called Apple at Work. Although not specifically geared for any one industry the goal, aside from the obvious, is to make the process for companies that want to buy Apple products across their business more efficient.

A program that seems related to this is Aetna’s alliance with Apple forged a couple of years ago. Through the alliance, Aetna subsidizes the cost of providing wearables to their employer groups and that partnership extends to the Apple store. In August last year Aetna hired Ben Wanamaker from Walmart to lead that program.

It will be interesting to see how upgrades to smartwatch and iOS network impact sales this year. In a preview of its Series 4 smartwatch last fall, Apple revealed it had added increased the sophistication of the watch to include measures for resting heart rate, workout, and recovery, according to a description on the company’s website. It also gives users the choice of receiving notifications when their resting heart rate is elevated beyond their baseline rate, which could flag arrhythmias.

More recently Apple kicked off a pilot of the medical records component of its health app with a group of health systems to make it easier for patients to access their data from their electronic health records.

Photo: Apple