Xiaomi is working on its second-generation wearables with more features but at a lower price.

Lei Jun, Xiaomi's CEO, said earlier the Beijing-based company will keep updating its product line with inexpensive but good quality devices.

Jason Low, a Canalys analyst monitoring the Chinese wearables sector, said the market was extremely diversified and every player is seeking its own way of selling more products.

"An effective channel strategy will easily give a mid-sized vendor 100,000 units in quarterly shipment. Finding the right marketing plan becomes critical as the market remains young," Low said.

Vendors will continue to battle for position behind Apple in the rest of this year, he said, as a raft of new devices from various companies hits the market in the upcoming holiday season.