- Apple is targeting the healthcare sector as it gets closer to a $2 trillion valuation.
- The Apple Watch, along with three other vital services, swayed the company to healthcare.
- The company’s dominance in the wearables industry is further fueling its presence in the industry.
Apple (NASDAQ:AAPL) is on track to become the first $2 trillion company in history, Wedbush analyst Dan Ives said in January. A large part of the strategy to fuel future growth seems to be the healthcare sector.
The tech giant made strides in the wearable sector throughout 2019. The Apple Watch—the firm’s flagship wearables product—will likely be the company’s pathway into America’s $3.5 trillion healthcare industry.
Why Healthcare and Wearables Are So Critical For Apple in the Long-Term
Throughout 2019, leading technology conglomerates suffered from plateauing smartphone sales.
To offset the decline of the mobile phone market, Apple diversified into wearables and online streaming.
Apple dominated the wearables space in 2019 with massive year-over-year growth. | Source: IDC
The Apple Watch and AirPods Pro saw explosive demand in late 2019. According to IDC, the firm dominated the wearables market last year with a 35% market share. Apple officially recorded year-over-year growth of 195.5% in the wearables space.
The success of the flagship watch primarily drove Apple’s entrance into the healthcare sector. Apple Watch provides various health-related services, including heart rate monitoring and fall detection alerts. As the clientele of the Apple Watch grew, Apple naturally swayed to the healthcare market.
Jeffrey Wessler, the CEO of heart health clinic Heartbeat, said:
It really was a catalyst for the industry because it was the first time a consumer device began to infiltrate the clinical environment in a high volume way.
Now, CNBC reports that the firm has a large team of doctors, engineers, and health specialists to aid the development of both software and hardware for healthcare.
The company’s current services in the healthcare market are narrowed down to four products:
- Apple Watch, which records heart rate and integrates health-focused applications.
- Processing medical records using the iPhone.
- Software kits for health application developers and engineers.
- AC Wellness, an internal healthcare system, for its employees in California.
Apple achieved a $1.5 trillion valuation mainly due to its dominance of the mobile phone, computer, and wearables market. Doctors say Apple Watch is only the beginning of the company’s foray into the healthcare sector.
Apple’s stock price since May 2019. | Source: Yahoo Finance
A Game-Changing Product Left to Develop
The Apple Watch can infiltrate into so many submarkets within healthcare. According to Henrik Berggren, the founder of diabetes clinic Steady Health, blood pressure monitoring would be a game-changer for Apple:
If they came out with a blood sugar or blood pressure monitor that was non-invasive and continuous, it would be a complete game-changer.
If Apple can track and observe more health-related data in areas including sleep, blood pressure, and food intake, analysts foresee the company evolving into a dominant force in the industry.
Disclaimer: The opinions expressed in this article do not necessarily reflect the views of CCN.com and should not be considered investment or trading advice from CCN.com. The author holds no investment position in the above-mentioned companies.