Overall the demand for wearable devices grew globally by 8 percent year-on-year in Q2 2017, with Chinese manufacturer Xiaomi leading the way, according to Canalys.
Xiaomi had the highest number of shipments with 3.5 million units, which was followed by Fitbit, with 3.3 million units, but Canalys says this is a 34 percent drop from last year. Meanwhile Apple fell to third with 2.7 million shipments of the Apple Watch. The other two companies predominantly sell fitness bands, according to Canalys.
However, Canalys predicts that the forthcoming Apple Watch 3 will help the Cupertino giant gain back ground with the watch's biggest selling feature being its rumored ability to work without an iPhone.
Canalys says that the demand for cellular watches will grow to 40 million units by the year 2021 on the back of the Apple Watch 3.
Representatives for Apple did not respond immediately for CNET's request for comment.