Huawei’s Watch 5 set to drive wearable band’s health and standalone device capabilities

Earlier this month, Huawei launched its latest generation of smartwatches with the Watch 5 series, in which it is using the “AI Smartwatch” messaging for the first time. This messaging signals a technological evolution, and a more profound shift in Huawei’s approach to wearables—from passive health-tracking to becoming an active health intervention platform. At a time when the global wearable band market is facing slowing growth and increased commoditization, Huawei is reimagining the smartwatch as a central platform for health decision-making, opening a new growth avenue for the industry.

In 2024, global wearable band shipments grew by 4%, according to Canalys (now part of Omdia) estimates, marking improving conditions but with limited growth. While some continued recovery is expected in 2025, this rebound is driven largely by entry-level products, functional convergence, and vendors increasingly using wearable bands as they expand their geographical footprints. Additionally, high-end smartwatches are struggling with low user stickiness and weak differentiation. Huawei aims to break this stagnation with the Watch 5 by emphasizing its health intervention capabilities, shifting the device’s value from measurement to real-time guidance and decision support.

Three key upgrades in the Watch 5 series

Huawei's Watch 5 has three key upgrades compared to the previous generations, both reflecting Huawei's strategic ambitions and differentiation aims. 

• Proactive health intervention: The Watch 5 combines on-device AI computing and multi-modal sensing to detect potential health risks such as irregular heart rate and sleep-related breathing issues. It can provide personalized intervention suggestions and connect with tele-medicine platforms and emergency services, making it a real-time decision node for personal health management.
• Standalone smart terminal: Equipped with Huawei’s self-developed chip, the Watch 5 enables efficient local AI inference, ensuring data privacy and quick response. It also introduces 5G eSIM connectivity (domestic market), allowing the device to operate independently, supporting voice calls, real-time health data transmission, and location sharing. These features are especially relevant for elderly care and high-intensity sports scenarios.
• Health ecosystem hub: Powered by HarmonyOS, the device supports multi-device integration (eg, automatic SOS after a fall), and offers open APIs and SDKs for third-party developers such as fitness app Keep and tele-health provider WeDoctor. Huawei is also exploring data-model-service integration, health service subscriptions, and B2B2C commercialization models through partnerships with insurers and corporate wellness programs.

How smartphone milestone reflects a new strategic aim for Huawei

As Huawei continues to focus on tech leadership positioning and targets high-end smartwatch growth, the new watch series brings forward some of most key components in Huawei's strategy:

From hardware to service: The Watch 5 serves as a high-frequency user touchpoint, enabling Huawei to transition from transactional hardware sales to continuous service operation, including health interventions and risk alerts.

Integrated technology stack for differentiation: In the absence of mature medical certification frameworks in China, Huawei’s vertical integration of proprietary chips, algorithms, and sensors creates technical and regulatory resilience, helping it establish a sustainable competitive edge.

Platform for international expansion: Huawei continues to lead China’s wearable market, with Canalys (now part of Omdia) reporting a market share of over 30%. Its Health app has over a million monthly active users, offering a strong base for expanding its health intervention model.

Challenges ahead: from product concept to scaled ecosystem

While Huawei’s “health brain” vision is pioneering, it faces three major challenges to turn in engineering success into wide-scale consumer adoption and business success:

• Reframing user perception: Most consumers still see smartwatches as upgraded fitness trackers. Huawei must build consumer trust in proactive health features through scenario-based education and clear articulation of intervention value.
• Validating business models: Subscription-based health services are still in their early stages in China. Whether users will pay for AI-driven health suggestions remains uncertain. Collaborations with insurers or employers could help establish indirect B2B2C revenue pathways, easing pressure on direct consumer monetization.
• Ecosystem collaboration barriers: To realize full platform potential, Huawei must onboard healthcare providers, fitness services, and third-party developers. This requires resolving issues around API standardization, data compliance, liability boundaries, and revenue-sharing mechanisms. Without coherent rules, service fragmentation could limit user experience and adoption.

Strategic recommendations: building a long-term closed-loop system

To capitalize on being an early player to target health-centric wearables, Huawei should focus on four long-term priorities:

Building a trustworthy AI health system
Back intervention claims with clinical-grade validation and real-world application scenarios to convert the concept of “AI intervention” into a reliable, daily health companion in the eyes of consumers.

Innovating the monetization model
Leverage a “B2B to drive B2C” dual strategy. Start with enterprise wellness and insurance collaboration to establish subscription foundations, while experimenting with tiered consumer plans to expand adoption.

Leading ecosystem governance
Proactively shape technical standards, data governance policies, and profit-sharing frameworks to attract deep ecosystem participation and avoid fragmentation.

Laying the groundwork for global compliance
Prepare for international scale by investing in medical certification, data protection infrastructure, and regulatory alignment, especially in markets such as Europe and North America.

Redefining the smartwatch value equation

The Huawei Watch 5 Series is designed to shift wearables from tracking and visualizing data to providing intelligent, proactive health support. Whether the Watch 5 succeeds will depend not only on its technical features but on user perception transformation, ecosystem depth, and sustainable business models.

Huawei’s bold move may foreshadow an industry-wide pivot:

• Function evolution: From data collection to real-time, personalized intervention.
• Role transformation: From isolated device to multi-sector health platform.
• Value shift: From product margins to lifetime health engagement.

In an industry where showcasing big innovation leaps is getting more difficult, Huawei is redefining the smart wearable value formula—from one-time hardware sales to long-cycle health outcome monetization. This shift might open a new path for sustainable growth across the wearable industry.