Apple's $24 billion wearables segment is now almost as big as its Mac business (AAPL)

Sales of those products, which include Apple Watch and its AirPods line of wireless headphones, grew 54% in its fiscal fourth quarter to $6.5 billion.
CEO Tim Cook believes that the wearables business is just getting started; three-fourths of Apple Watch buyers in the most recent quarter were buying their first one.
Apple on Wednesday launched another new wearable product its AirPods Pro wireless headphones.
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For Apple, success these days comes in small packages.

In its just-completed fiscal year, the tech giant got nearly as much revenue from sales of its collection of wearable products and accessories as it got from selling its venerable Mac computers. The company's wearables and accessories business which includes sales of Apple Watch, AirPods, and the HomePod smart speaker appears well on its way to becoming its second largest line of products after the iPhone and its third largest business category overall after its smartphone and services segments.

"Wearables have done extremely well," Apple CEO Tim Cook said on a conference call with Wall Street analysts on Wednesday following the company's fiscal fourth quarter earnings announcement . "We're thrilled with the results."

Apple reported better-than-expected revenue and earnings for its most recent quarter. The company's booming wearables and accessories segment helped to make up for declining iPhone sales. In the period, sales of wearable and accessories products grew 54% from the same quarter last year to $6.5 billion. By contrast, iPhone sales fell 9% to $33.4 billion.

Screen Shot 2019 10 30 at 4.20.58 PM Apple/T Wolverton

In fiscal 2019, Apple's wearables business brought in $24.5 billion in sales. That's 95% of the tally of its Mac business during the same period. By comparison, in fiscal 2018, wearables and accessories revenue were only 69% of Mac sales and two years ago, they were about half.

Cook thinks Apple's only just getting started when it comes to its wearables and accessories. Sales of AirPods "keep hitting new highs," he told analysts on the call. Meanwhile, about three-fourths of Apple Watch purchasers in the quarter were buying their first one, he said.

"We're still significantly in the build mode there," he said.

And new products could continue to fuel the business. On Wednesday, Apple launched its new AirPods Pro . Unlike previous AirPods, the new wireless headphones feature active noise cancellation and water resistance. Priced at $250, they also cost $90 more than the older ones.

But don't expect Apple to provide any specifics about the number of Apple Watches or AirPods it has sold. In response to an analyst question on the company's earnings conference call, Cook reiterated that "we're not releasing the precise number of wearables. But nice try trying to get me to say that."