Samsung’s big plan to compete with the Apple Watch: keeping you healthy as you age

Samsung is targeting the digital health market amid rising healthcare costs and an aging population, aiming to surpass Apple in wearable technology by focusing on preventative health advice and leveraging its existing presence in home appliances. The upcoming smartwatch update will include features like antioxidant level estimation and personalized training programs, competing with similar offerings from Apple and smaller health tech companies. While Samsung is the leading smartphone maker, it trails Apple in the smartwatch market with approximately 6% market share compared to Apple's 20% in Q1 2025, and faces challenges due to its smartwatches' incompatibility with iPhones, though future collaboration with Apple remains a possibility.

Analysis

Samsung is strategically intensifying its focus on the digital health market, responding to rising healthcare costs and an aging population's preference for aging in place. The company aims to leverage these trends and its established presence in home appliances to challenge Apple in the wearable technology sector, particularly as smartphone sales decelerate. An upcoming smartwatch software update, featuring novel functionalities such as antioxidant level estimation through LED skin scanning and personalized running programs, underscores this ambition; a beta version is slated for release this month for Galaxy Watch 5 and newer models. Despite its status as the world's largest smartphone manufacturer by market share, Samsung's Q1 2025 smartwatch market share was approximately 6%, significantly trailing Apple's ~20%, as reported by IDC. This gap is partly attributed by IDC to Apple's superior marketing of the Apple Watch as a compelling smartphone companion. Samsung's differentiation strategy hinges on preventative health advice, aiming to assist users with diet and sleep management. However, it faces robust competition from Apple, which recently unveiled its 'Workout Buddy' coach, and specialized health tech firms like Oura. Hon Pak, Samsung's head of digital health, indicated future initiatives include an AI-powered health chatbot and potential smart glasses applications for AI-assisted meal logging. A critical challenge is the current incompatibility of Samsung smartwatches with iPhones, though Pak acknowledged ongoing discussions regarding potential future interoperability with Apple.

Key Decisions for Investors

• Investors should closely monitor Samsung's smartwatch market share and user adoption rates following the new software update, as these metrics will be key indicators of its ability to effectively compete with Apple in the digital health arena.
• The potential for Samsung to make its smartwatches compatible with iPhones warrants attention, as such a move could significantly expand its addressable market and alter its competitive positioning in the wearables segment.
• Evaluate Samsung's progress in differentiating its health offerings through AI and unique preventative features, as successful innovation is crucial for narrowing the market share gap with leaders like Apple and justifying further investment in its wearable technology division.