Apple's Wearables, Home and Accessories segment generated $27.3 billion in sales through the first three quarters of fiscal 2026, but its share of total company revenue has shrunk to 7.5%, down from a peak of 11.2% in 2020.

The decline is structural, not seasonal. Sales in the segment — which spans the Apple Watch, AirPods, the Apple Vision Pro and smart home products — have fallen in each of the past three fiscal years. The supporting cast of Apple's product lineup has failed to keep pace with the growth of the rest of the business.

How big is the gap?

The numbers frame the imbalance. In the first three quarters of fiscal 2026:

• Wearables, Home and Accessories: $27.3 billion
• iPhone: $196.5 billion
• Services: $91.7 billion

Despite the erosion, the segment remains Apple's third largest revenue contributor. No other product line comes close to those three pillars. That position gives the category continued strategic weight even as its relative share declines.

Apple Watch and AirPods likely account for the lion's share of the segment's revenue, according to the reporting. That concentration leaves the smaller pieces — smart home devices and the Vision Pro — carrying outsized importance for any future recovery.

Why does the segment keep shrinking?

The segment peaked in fiscal 2020, when it represented 11.2% of Apple's total sales. Three consecutive annual declines followed, and by the first three quarters of fiscal 2026 the figure had fallen to 7.5%. That is a drop of roughly a third of the segment's relative weight in six years.

The dynamic is relative as much as absolute. Apple's core businesses — the iPhone above all, with nearly $200 billion in sales — have grown faster than the accessories portfolio, compressing the wearables share even before accounting for the segment's own declining sales.

For component suppliers, the trend matters directly. AirPods and Apple Watch drive meaningful volumes in audio codecs, sensors, displays, power management and wireless silicon. A segment that shrinks both absolutely and relatively translates into softer demand growth for the suppliers tied to those product families, even as iPhone and Services-related silicon demand climbs.

Has Apple given up on smart home?

Apparently not. Despite the segment's three-year slide, Apple is not yet ready to abandon the smart home category, according to the report. The company continues to treat it as part of the portfolio rather than a candidate for exit.

That persistence sets Apple apart from the trajectory the raw numbers might suggest. A segment declining for three straight years, and now worth barely a fifth of Services revenue, would in many companies face consolidation or cuts. Apple's willingness to stay invested signals that the company sees long-term value in the category — or at least strategic value in holding the position.

The open question is whether any upcoming smart home or wearable products can reverse the segment's share slide, or whether Apple's revenue mix will continue concentrating around the iPhone and Services. With the segment at 7.5% and falling, the burden of proof sits with the next product cycle.