After succumbing to Xiaomi and Fitbit in Q2 of 2017, Apple has once again regained the top spot in the wearables market for Q3, according to Canalys’ latest report. The Cupertino giant managed to ship 3.9 million units in the most recent quarter following the launch of Apple Watch Series 3, while Xiaomi and Fitbit shipped 3.6 million and 3.5 million wearable bands, respectively. Shipments during the period have been impressive for a quarter that has been traditionally slow.

Canalys notes that despite the increase in smartwatch shipments in Q3, the demand for basic fitness bands has been slowing down, leading to an overall fall in the wearable band market by 2 percent after having sold 17.3 million units. For Apple, the increase in demand for its Apple Watch is a positive sign and Canalys had expected back in August that cellular-enabled smartwatches would boost the market in the second half of 2017.

“Strong demand for the LTE-enabled Apple Watch Series 3 has dispelled service providers’ doubts about the cellular smartwatch not appealing to customers,” said Canalys Analyst Jason Low. Apple was unable to fully meet the market demand for the Apple Watch Series 3 due to low supply in popular markets. The Cupertino giant has faced some hiccups in production that also affected the supply of the iPhone X. The report adds that roughly 800,000 Apple Watch units shipped in Q3 were cellular-enabled.

Also Read: Apple to launch three new iPhones in 2018, all with iPhone X-like design: Report

Apple along with Samsung and Huawei were the top three vendors by volume in Q3 2017. These companies have positioned their smartwatches to compliment their premium smartphones, Canalys notes. “While health features continue to be the core focus, vendors are striving to increase the value of smartwatches by prioritizing design and highlighting key features,” said Canalys Research Analyst Mo Jia.

These companies are using smartwatches to create an ecosystem strategy, which leads to brand loyalty. “Smartphone vendors must reevaluate their respective smartwatch strategies to derive more value beyond smartphone growth,” the report adds.

Vendors expect a strong growth in Q4 as new smartwatches bring improved health-tracking features, longer battery life, better and slimmer design among other things. Last quarter will be important to assess how consumers take to fashionable smartwatches as compared to the traditional fitness bands. Google will also need to improve its own Android Wear ecosystem if it want to be able to compete against Apple, Samsung and Fitbit currently dominating with their own watch software platforms, Low added. 

The Apple Watch Series 3 is the first smartwatch from the Cupertino giant to support cellular connectivity. The watch comes with an embedded SIM that allows you to make calls or stream Apple Music without the need of your iPhone nearby. However, consumers in India will only be able to purchase the non-LTE version of Series 3, which starts at Rs 29,900.

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