Apple can't afford to drop it yet. It will be refined for another iteration or two. It may or may not be dropped quietly a few years from now - possibly with Tim Cook.

Watch has been a huge and very expensive misstep. IMO Apple should have tried to own the home automation market, with secure, high-margin, high-quality products linked into the Apple ecosystem and built with some measure of AI and smart collective decision making - the kind of thing Nest tried to do, but never quite got right, and which the other players in that market (Belkin, etc) don't have the smarts to try.

Watch is a mistake because it's not useful in the way that classic Apple products are. It can do some mildly interesting things, but the whole point of an Apple product is that you're supposed to dream about owning it because you can do more with it than without it.

Watch doesn't do that. It's a fashion accessory, not a powerful tool that happens to be beautifully designed. So even if it's refined physically - thinner, etc - it's never going to be a huge success unless someone in Cupertino works out how to change that.