Apple (AAPL) has officially halted online sales of its Apple Watch Series 9 and Apple Watch Ultra 2 in the US due to a patent dispute between the tech giant and medical technology company Masimo (MASI) related to the devices’ blood oxygen sensors.
Apple stopped selling the smartwatches via its online stores at 3:00 p.m. ET on Thursday. The web pages for both the Series 9 and Ultra 2 list them as currently unavailable with no option to purchase them. In-store sales, as well as delivery and pickup of online orders, will stop Dec. 24.
In October, the International Trade Commission (ITC) issued cease-and-desist and limited exclusion orders that force Apple to stop importing the watches and selling them through its first-party stores after a presidential review period that ends Dec. 25.
While the Biden administration could still veto the orders, Apple is pulling the watches early to ensure it is in compliance in case the White House doesn’t make any moves.
Third-party retailers such as Best Buy can continue to sell the watches. Apple will also be able to continue selling the Apple Watch SE, because it doesn’t include a blood oxygen sensor.
Apple can address the patent dispute by reaching a deal with Masimo, altering the Apple Watch’s hardware, or, potentially, making software changes to the wearables.
The US is Apple’s most lucrative market. And while the company can still sell the Apple Watches outside of its home country, it risks losing out on a chunk of potential revenue.
Apple Watch is the world’s best-selling smartwatch. According to Counterpoint Research, Apple’s Watches accounted for 22% of global smartwatch shipments in Q3 2023. India’s Fire-Boltt and China’s Huawei produced the second and third best-selling watches, capturing 10% and 9% of the market, respectively.
The Apple Watch line is one of Apple’s most successful accessories. It not only provides the company with user lock-in by getting consumers to stick to its ecosystem of products; it’s also a means to get users to sign up for the Apple Fitness+ subscription service.
Apple doesn’t break out individual sales numbers for its watches. Instead, the company reports sales as part of its wearables, home, and accessories business.
That segment brought in $39.8 billion in revenue in the company’s fiscal 2023, making it Apple’s third-largest business behind the iPhone, which made $200.6 billion last year, and services, which was responsible for $85.2 billion in revenue.