Wear OS 7 and Apple watchOS 27 Upgrades Could Further Boost the Outlook for Smartwatches

Smartwatches have continued their inexorable rise by taking a larger slice of the wrist-based real estate. From ABI Research’s own smartwatch research in Wearables and Mobile Accessories Market Share and Forecasts (MD-WEAR-114) published in March 2026, smartwatch shipments eclipsed 141.1 million for the full year of 2025. What is driving this purchasing activity? Innovation continues to drive increased interest in the sector. Smartwatches not only offer sports activity tracking, but also wellness (sleep, heart health, blood oxygen, etc.) tracking. There have also been improvements in battery life and higher resolution screens, as well as the integration of high-value materials (gold, silver, titanium) into smartwatch design. Software and feature innovation also accelerated. This could be seen in the recent Wear OS 7 announcements at Google I/O in late May 2026 and the watchOS 27 platform announcements at Apple’s WWDC 2026 event just last week.

At the Google I/O event, several upgrades to its Wear OS operating system were announced. In addition to several display upgrades and improved system performance, particular emphasis was placed on Gemini Intelligence integration, as well as greater control over where an end user wishes to stream audio output:

• Gemini Intelligence & Task Automation: Google’s Gemini Artificial Intelligence (AI) assistant enables multistep task automation via voice. Examples include reordering food, compiling shopping lists from emails, and triggering complex phone actions.
• Remote Output Switcher: New system media controls let users change audio output directly from their watch, i.e., they can switch between Bluetooth® headphones, smartwatch speakers, or smart home devices.
• Wear Widgets Replace Tiles: Flexible widget layouts and customizable glanceable data, similar to Android smartphone widgets, enable users to port custom widgets created with mobile AI tools directly to the watch.
• Live Updates on Your Wrist: Persistent, real-time tracking timelines for deliveries, rideshare arrivals, or sports scores). It works like Apple’s Live Activities, but is integrated into Wear OS smart stack.
• Unified Workout Tracking: Standardized framework for fitness apps, with consistent User Interface (UI) layouts, heart-rate tracking, and media controls across third-party apps. This improves reliability and ecosystem consistency.
• Optimized Battery Life: System-level improvements to offset AI processing demands. Google claims up to 10% better battery life.
• Per-App Media Auto-Launch: Granular control over when media controls appear, e.g., auto-launch for Spotify, but it is blocked for casual video playback, preventing unnecessary interruptions.

Apple watchOS 27 was announced on June 8 at Apple’s WWDC 2026 event. In addition to new watch faces, Apple aggressively promoted its Apple Intelligence in the form of Siri AI. Apple’s enhanced personal AI beefs up watchOS’s Workout Buddy, as well as notification alerts such as Call Context that can bring confirmation numbers, booking codes, or account IDs to your attention. Furthermore, deeper AI-enabled health insights were integrated with Siri AI wellness advice.

ABI Research forecasts the smartwatches market to grow to 196.4 million by 2031, representing a Compound Annual Growth Rate (CAGR) of 6%. What is the Total Addressable Market (TAM) for smartwatches? ABI Research does not track the traditional analog and digital timepiece market, but third-party sources estimate 215 million sold annually. Estimating the installed base of watches strapped to wrists is challenging, but ABI Research estimates 15% to 20% of Earth’s 8.3 billion inhabitants wear analog, digital, or smartwatches, which equates to ~1.5 billion. Certainly, a proportion of the traditional wristwatch market could be targeted by smartwatches. While some industries (military, sensitive positions in government agencies, etc.) could block the use of smartwatches based on security grounds, some population segments are proactively adopting smartwatches such as the senior citizens and kids’ sectors. How are some of the traditional timepiece vendors responding? While some of the upmarket/luxury smartwatch brands such as Tag Hauer have embraced hybrid and even full smart designs, it is unlikely that brands such as Rolex will adopt smartwatch concepts.

While a smartwatch should not replicate all the functionality of a smartphone, the physical immediacy and presence of a smartwatch can offer some unique advantages. More robust and accurate sports and wellness features will be attractive, but additional AI-enabled features such as live translation, universal emergency response, ambient audio recording, and remote audio output switching could also boost the value and utility of smartwatches. Is there another electronic device class that could deflate the smartwatch’s opportunity? The more basic activity tracker had been experiencing declining fortunes, as cost of production and the perceived value of smartwatch features improved. However, new form factors such as screenless or minimalistic activity trackers (e.g., the Whoop and Hume) are starting to gain traction in the market. Sports and wellness metrics are kept out of immediate viewing, but they can be reviewed later on your mobile phone. Another smart device that could take a slice of the smartwatch market could be smart glasses or Augmented Reality (AR) glasses that could provide “in field of view” time information, event notification, and sports and wellness metrics.