Bloomberg: Apple's wearables lead is slipping as the Apple Watch stalls

Eleven years after launching the Apple Watch, Apple is slowing down in a category where the broader market is accelerating. Screenless bands and smart rings are pulling in users, while the company's Health app is falling behind competitors. The same Bloomberg report also covers updates to AirPods, improvements to Genmoji, and support for AirPlay alternatives in iOS 27.

In the latest issue of his Power On newsletter, Bloomberg's Mark Gurman wrote that wearables and health — one of Apple's most successful product areas — is at risk of losing its lead. The Apple Watch remains one of the best smartwatches on the market, but the pace of innovation has slowed while competitors are rethinking the category itself.

Gurman also revealed new details about iOS 27. Apple is preparing to redesign the AirPods control panel, improve Genmoji and image generation, and, at the European Union's insistence, add support for alternatives to AirPlay.

Apple Watch growth is leveling off

The Apple Watch's influence on the industry is hard to overstate. The device reshaped the smartwatch market, generated an estimated $100 billion in revenue over its lifetime, and turned Apple into a major player in health and wearables. Since its launch in 2015, the device has set the tone for the entire category, and since 2022, the Ultra model has become a popular alternative to Garmin among outdoor enthusiasts.

Eleven years after its debut, however, the product line has slowed down at precisely the moment when competition in wearables is intensifying. User preferences are shifting as well, with many people moving away from screen-centric gadgets toward simpler devices that rely on passive data collection, long battery life, and AI-driven insights. Companies like Whoop and Oura have built multibillion-dollar businesses around screenless bands and rings that track sleep, recovery, and health without bombarding users with notifications. Google is moving in the same direction with the screenless Fitbit Air tracker priced at $100.

According to Gurman, Apple should not walk away from the watch — the device still has clear advantages in connectivity, fitness tracking, and integration with the iPhone. But the company needs to move aggressively beyond traditional smartwatches before competitors rewrite the rules of the category without it. Given Apple's strengths in chip design, sensors, and materials, a screenless Apple ring or band should have been something the company built first, rather than racing to catch up.

The Health app is falling behind

Gurman's sharpest criticism is reserved for the software side. Despite years of investment, the Health app still feels overloaded and clinical, and it does a poor job of turning raw data into clear recommendations. Platforms like Whoop and Oura are noticeably better at translating metrics into actionable advice and helping users build healthy habits. Using Apple's app, Gurman writes, still feels like studying medical charts in a doctor's waiting room.

The company is aware of the problem internally. Eddy Cue, who personally uses both Oura and Whoop devices, has been pushing for more significant changes in Apple's health strategy. An ambitious AI coaching project called Mulberry was recently scaled back after Cue took over the relevant division. Gurman does not expect any of the Mulberry work to ship before the later stages of the iOS 27 update cycle.

The current features look strong in marketing materials but stop short of meaningful impact. Sleep apnea and hypertension detection can alert users to potential problems, but the company does not offer deep analysis, continuous monitoring, or specific next steps, ultimately telling users to consult a doctor. The market, meanwhile, is moving toward real-time blood pressure measurement and predictive insights powered by modern AI, while Apple remains cautious due to concerns about accuracy, regulation, and potential lawsuits.

Leadership turbulence

The problems are not limited to the products themselves. Jeff Williams, the former chief operating officer and longtime overseer of Apple's health initiatives, retired last year. CEO Tim Cook, who has repeatedly cited the launch of the Apple Watch as one of the most meaningful moments of his tenure, will step down in September. Fitness+ head Jay Blahnik is leaving the company amid scrutiny over his management style. Stan Ng, who led marketing for the Watch and health products, recently retired, and senior Apple Watch marketer Eric Charles departed earlier this month. Apple has also been steadily losing health and hardware talent to Oura.

Incoming CEO John Ternus, who took over the Apple Watch business several years ago, wants to keep health and fitness at the center of Apple's strategy and has promised new services that combine hardware with AI. Following Ng's retirement, marketing for the Watch, health, and smart home now reports to Kaiann Drance, a longtime iPhone marketing executive whom industry observers expect to eventually lead all of Apple's marketing. That decision, however, also reflects a deeper issue: the Apple Watch is still being positioned more as an accessory to the iPhone than as a standalone product.

The bet on non-invasive glucose monitoring

A breakthrough could come from Apple's long-running non-invasive glucose monitoring project. The idea dates back to the Steve Jobs era and aims to develop sensors that can detect elevated blood sugar without finger pricks or blood draws. The company recently transferred oversight of the project from platform architecture head Tim Millet to Zongjian Chen, a senior engineering executive who runs the Advanced Technology Group and oversees hardware such as modems. Some observers see the move as a signal that the project has finally reached a stage where it can be developed into a consumer product.

That said, watchOS 27 this year will focus largely on stability, performance, and small refinements rather than major new features, although Apple has promised improvements to heart rate measurement accuracy. The company has also been leaning more on discounts and promotions to support Watch sales. Amazon and Best Buy have recently offered unusually aggressive discounts on the device, and Apple itself for the first time added the Watch to its education store with a direct price reduction. According to Gurman, leading the next generation of wearables will require Apple to become significantly bolder, move faster, and embrace more risk.

What else is coming in iOS 27

Beyond the main story, Gurman revealed several details about Apple's fall update. The first involves AirPods. Since the headphones gained head gesture recognition and a hearing aid mode, users have increasingly been asking for a dedicated app for managing them, similar to those available for the Apple Watch and Vision Pro. A separate app is not expected this year, but Apple is redesigning the AirPods settings menu to make it more functional, intuitive, and easier to navigate. The changes will appear across iOS 27, iPadOS 27, and macOS 27.

The second update concerns image generation. Genmoji and the Image Playground app are set to receive significant improvements in visual quality. Gurman had previously reported that Apple was preparing to integrate third-party AI models beyond OpenAI's ChatGPT. He now confirms that Apple has also refined its own internal models for Genmoji and Image Playground, with noticeable quality improvements arriving this year.

The third detail relates to European Union regulations. To comply with the Digital Markets Act, Apple is building support for third-party AirPlay alternatives into iOS 27. This means external services such as Google Cast can be set as the default for streaming video, photos, and audio from an Apple device to a speaker or television. The company has already allowed third-party app stores and sideloading in the EU under the same regulatory pressure.