Apple announced today that it plans to introduce a redesigned Blood Oxygen feature for some users of its Apple Watch devices.
The company said that it intends to issue an iPhone and Apple Watch software update later today. The redesigned feature will come to some Series 9, Series 10 and Ultra 2 smartwatch users. Users without the Blood Oxygen feature can access the redesigned one by updating their paired devices.
Following the update, sensor data from the app on the watch will be measured and calculated on the paired iPhone. Users can view their results in the Respiratory section of their Health app.
According to Apple, a recent U.S. Customs ruling enabled the update. This comes nearly two years after the tech giant paused sales of certain watches amid a patent dispute with health monitoring company Masimo.
The patent spat goes back as far as January 2020, centering around light-based pulse oximetry technology used by the watches. Masimo develops a number of technologies that use pulse oximetry, including its FDA-cleared W1 smartwatch.
A turning point in the long-running dispute came in October 2023 when the U.S. International Trade Commission (ITC) ruled in Masimo’s favor. The ITC recommended a limited exclusion order for infringing Apple Watches with light-based pulse oximetry functionality. It found that Apple violated U.S. laws by incorporating this patented technology in its products. The battle continued last fall, with both companies claiming victories in their spat.
The analysts’ reaction to the latest Apple development and how it affects Masimo
BTIG analysts Marie Thibault, Sam Eiber and Alexandra Pang note that the U.S. Customs ruling affects only Apple Watches sold in the U.S. that didn’t include the original Blood Oxygen feature.
The analysts also say that, in early 2024, not long after the sales pause, the Exclusion Order Enforcement Branch of the U.S. Customs and Border Protection (CBP) allowed Apple to use a software workaround to sell its Apple Watch Series 9 and Ultra 2 with a redesign that did not include a pulse ox function.
Apple still has a pending federal appeal in its spat with Masimo, while Masimo’s infringement complaint goes to jury trial in November. Apple also has a complaint in Delaware district court set for trial at a later date.
“We await more details but do not think this U.S. Customs ruling and AAPL software update necessarily impact the legal arguments, and our recent investor discussions had seemed to point to no value being assigned for a potential litigation win,” the analysts said. “We continue to think any legal wins represent a call option for MASI, and we see a buying opportunity on today’s weakness.”
The analysts maintain a “Buy” rating for Masimo.
