Does the Apple Watch really own 75% of the smartwatch market?

In the second quarter of this year, the Strategy Analytics figures show, 5.3 million smartwatches were shipped included 4 million Apple Watches. If we assume a 15% sequential decline in revenue from those products, we can attribute roughly $1.2 billion in revenue to the Apple Watch.

Apple’s shares fell 4.4 per cent to $125 at 1:36 p.m. Wednesday in New York. Software updates for OS X, Apple’s operating system for its personal computers, also were down during the period.

The revised projection comes a day after Apple reported its profit rose 38% for the fiscal third quarter, though it fell short of expectations for iPhone sales.

The earnings come shortly after one report claimed the Apple watch sales in the US have fallen dramatically since its debut.

And of the more than a dozen early Apple Watch owners interviewed by the AP by phone, email or in person, majority love their watch.

Apple is forecasting revenue to be between $49bn and $51bn in the fourth quarter. Interestingly and impressively though, global sales accounted for 64 percent of the quarter’s revenue. That’s about $952 million more than the previous quarter, when the watch had not yet gone on sale, or significantly less than the $1.8 billion in watch sales that analysts surveyed by FactSet were expecting.

Analyst Wamsi Mohan said that sales of 47.5 million iPhones were probably due to the decline in the channel inventory.

But beyond missing analyst estimates (despite reports of poor sales, some analysts had expected shipments as high as 5 million), this number doesn’t mean a whole lot by itself.

Communications minister Malcolm Turnbull is one prominent Australian who has purchased an Apple Watch.

In a vacuum, Apples results were good, particularly when accounting for the potential impact higher pricing due to currency may have had on units.

“We are getting a little bit of indigestion in the market over the past two sessions from tech earnings”, said David Schiegoleit, managing director of investments at the Private Client Reserve of US Bank in Los Angeles.

Apple’s rivals face challenges: Apple sold about 18.2 percent of all the smartphones worldwide in the first quarter of 2015, while Samsung had 24.5 percent of the market, according to IDC. Consequently Piper Jaffray raised its price target on Apple to $172 from $162 while maintaining an Overweight rating. Beyond this, the share of the Apple Watch Sport (the cheapest model starting at $349) heavily influences the ASP.

“Where are you going to find growth in the world?” he said.

While Apple provides specifics on iPhone and iPad sales, the Watch has been relegated to the “other products” category-along with iPods, Apple TV, and accessories.

And Apple said its gross margin – the difference between the amount it spends on making the products versus how much consumers pay – was 39.7%, up slightly on a year ago.