SINGAPORE – Apple set a new quarterly shipment record in the fourth quarter, contributing 6 million smartphone shipments to a global total of more than 9 million units. Apple’s smartphone shipments grew 12% year-over-year.

It was the Apple Watch’s best quarter, despite being significantly handicapped by supply constraints, even though Apple simultaneously expanded its supply chain, according to Canalys.

The Apple Watch generated more than $2.6 billion in revenue for Apple during the quarter, making up nearly 80% of total smartwatch revenue.

“Apart from the hardware and software improvements of the new models, Apple succeeded mainly due to its streamlined marketing and realigned pricing, which helped it address a wider audience,” said analyst Jason Low. "The Series 1’s lower entry price and Apple’s more focused fitness messaging made its Watch both more attainable and more relevant.”

Canalys estimates Apple cumulatively shipped 11.9 million Watches in 2016, holding market share of around 50% globally for the year.

Xiaomi also enjoyed a record quarter for basic band shipments, reaching 5.5 million Mi Bands.

“New batches of Mi Band 2s were shipped in time for the Singles’ Day shopping festival in China," said Low. “Building on the success of its first-generation Mi Band, Xiaomi quickly expanded the availability of the Mi Band 2 across Asia Pacific and Central and Eastern Europe. India, Poland and Russia were key markets where the device was introduced alongside the company’s Mi and Redmi smartphones through direct and third-party online channels.”

In the coming quarters, Samsung is expected to push shipments of its Gear S3 Classic and Frontier. Also, Android Wear shipment volumes will bounce back significantly, as new products that were postponed due to the delay of Android Wear 2.0 will soon be launched, says Canalys. Apple's smartwatch lead will increasingly be challenged by the rebounding competition.

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