The first thing they need to fix is the marketing. You cannot price a device along the same lines as a Mac Studio and not have it appeal to the same customer. Promo shots of a lonely person on a sofa do it no favours.
Clearly the device, even if it was $2000 would be too expensive as a consumer electronics device. Yet its a price easily swallowed by industry and education. This is where they need to double down their efforts. Work with startups. Design studios. Higher education. Surgeons. Engineers. Architects; find out what professionals want from the base OS and then give it to them.
The Apple Watch started out as a sidekick to the iPhone and quickly pivoted to a health and fitness focussed device and sales skyrocketed.