Apple Sold an Estimated 600,000 HomePod Speakers During the First Quarter of 2018

[Stella]

The profit of the actual product may be thin, the butterfly effect of the purchase multiples, especially for Google for reasons out outlined in my previous post.

Think outside of just profit margins.

Yes. Naive: (1)Apple would like to be the best seller (2) Apple wants to sell as many units as possible. (3) Apple is a consumer company.

Naive? They are profit leaders in every major category they compete in (as far as physical products go) while having nowhere near a dominant market share. They do this by excluding razor thin margin sectors explicitly. It’s clearly a winning strategy, so why would they bother competing with something like an echo dot when they can target the higher end where *there is actually money to be made*?

This is what I don’t get about people (explicitly not talking about the poster I quoted) whom compare Apple to Google or Amazon. Sure if you’re just a “market watcher” you can compare financials. But if you examine the *business strategy* of these companies it’s clear that the success of Google or Amazon is directly built on ubiquity models at low margin. Apple runs the complete opposite where the aim is not to have a device in every hand, but to get way more profit from a much smaller number of devices. Both of these are clearly winning models for each company, but they’re successful because of entirely different approaches to how they operate their businesses.

 

[Cigsm]

Find a hi fi speaker with the quality of the HomePod for less then $349

For me, there are just too many compromises for the price. I see it as a $199-$249 device, max. If it had some sort of line-in maybe I would have talked myself into one but I still doubt it. If it had a line-in and was between $199-$249 I would have bought a launch unit. At this point I'm waiting for the next generation. I doubt we'll ever get a line-in, but one can hope. Also, hope they don't do a "Mini" for a cheaper price. In my opinion, this is the "Mini" and the price should be lowered, and if anything come out with a larger one similar to the Home Max.

 

[Stella]

What is quality vs price point?

What does the customer want out of a smart speaker?

Everyone is going to have a valid different answer.

Find a hi fi speaker with the quality of the HomePod for less then $349

 

[cmChimera]

Have you listened to an Amazon Echo?

If you're an audiophile, you have audiophile speakers, I.e. Magenepan with a McIntosh amp, or if you're a frugal audiophile, you still have some stellar equipment.

My point isn't that low quality speakers cost less, its that Amazon Alexa/Echo, offers more value, functionality, and gets you to the same place, for less money than Siri and HomePod.

I have listened to an Echo. It’s poor.

The echo doesn’t get to the same place if you’re looking for quality sound.

 

[Baymowe335]

The profit of the actual product may be thin, the butterfly effect of the purchase multiples, especially for Google.

Think outside of just profit margins.

Yes. Naive: Apple would like to be the best seller.

Google is literally not even 50% as profitable as Apple and literally almost 90% of their sales comes from ads. Their hardware and Android OS forays are peanuts for their overall biz. And I own Google shares too.

Apple’s strategy thus far isn’t about market share because it would likely hurt their margins and overall strategy. Based on their numbers, the strategy works.

 

[Cigsm]

Do you actually have one? The sound quality is absolutely incredible.

You wouldn't want to even if you could. The thing is a garbage product.

 

[PickUrPoison]

Looking at the chart presented, I wouldn’t be surprised if Apple had 50%+ of the >$100 market segment, even with the current limited availability. (But HomePod should be in the wireless speaker segment, along with higher-quality, music-grade offerings from Sonos, Bose, Denon, Harman, the Google Home Max, etc.)

It’ll be interesting to see how the back-to-school quarter goes. I think the HomePod is going to be a must-have for every college kid’s dorm room, maybe third behind a mini-fridge and microwave. Apple should do a promo with Mac laptops or other popular products like Airpods, Watch and/or the (hopefully then-released) AirPower.

The holiday quarter should be good as well. Hopefully Apple can roll it out to another few dozen countries by then. But however slow and measured, it’s obviously the rollout Apple wants, for whatever reasons they may have. So I think they’re ok with HomePod’s launch quarter. I can’t imagine they expected to sell anywhere near the quantity Amazon and Google do with their $40-50 smart mics.

 

[dfs]

Right now the basic issue is that Apple is trying to vend a strictly monophonic speaker, and probably the most recent strictly monophonic speaker vanished from the marketplae sometime during the JFK administration. Come on, Apple, take the finger out, GIVE US STEREO, make the damned thing work the way ought. Then all will probably be well with your sales figures. When was the Home Pod released? Mid-December? It's now mid-May and not a twitch from Cupertino. Those of us who bought a pair did so because we had faith in you to deliver the goods, you're letting us down Big Time and ruining your credibility. GIVE US STEREO.

 

[chineseguy38]

HomePod is useless compares to the others. Siri is really bad. Can't even listen to command properly to play a song.

 

[bladerunner2000]

Do you actually have one? The sound quality is absolutely incredible.

I doubt that, LOL. I say that as someone with an Anthony Gallo home theatre system and Focal car system with an Alpine amp.

Apple has NEVER been known for sound quality. Remember the iPod Hifi?

 

[neutralguy]

Glad to see Google closing in on Amazon. The sooner Amazon goes away the better off we all will be.

Why? What's the problem with Amazon?

 

[Stella]

BS Apple isn’t about market Share. On stage, Tim is very happy to tell everyone they are #1 in sales! Apple want to sell as many units as they can... and that has hurt their quality... that we can agree on.

So what if 90% of google profits come from ads? That’s their main business, what do you expect! Like I said, Google Home is a generator for Ads... as is google other products. Its the butterfly/ ripple effect.

Google and Apple have different business models but both want to sell as many units as possible. Both business models are as valid as each other.

Google is literally not even 50% as profitable as Apple and literally almost 90% of their sales comes from ads. Their hardware and Android OS forays are peanuts for their overall biz. And I own Google shares too.

Apple’s strategy thus far isn’t about market share because it would likely hurt their margins and overall strategy. Based on their numbers, the strategy works.

 

[neutralguy]

I’m pretty sure this is not and has never been Apple’s goal, any more than their goal is to sell the most iPhones or the most home computers, any more than Mercedes-Benz has a goal of selling the most cars.

Ate you sure if you had the same opinion if Apple had sold 3 mil?
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6% market share but probably 30% of the profit. Be suspicious of cheap products as they are going after something else...

Hmm.. do you buy Rolex and drive around a Rolls Royce?

 

[mtneer]

... no doubt Siri will be improved with future updates ..

I've been holding that breath since 2011!

 

[ActionableMango]

Unbelievable that people defend the HomePod because it creates better profit margins for Apple than Echos probably do for Amazon.

In the old days (1970’s, 80’s 90’s, 00’s) the usual Apple user liked Apple because the products were amazing, not because it created better corporate profits.

First of all, the context of this article is that HomePod sales numbers are low and its marketshare is low, thus implying that HomePod is a financial or market failure for Apple. In the context of this article and thread, saying that HomePod is very profitable is absolutely relevant and an appropriate response in defense of it not being a failed product.

Secondly, there are AAPL investors here, like myself, so we definitely want to see Apple profit margins remain high.

Third, high profits and lack of market share are not mutually exclusive to customer satisfaction. Apple typically enjoys very high customer satisfaction.

Fourth, HomePod reviews very well as a speaker. It does not review well as a voice command device, and that's absolutely a problem, but it's a problem that's well known across the entire lineup and it's not limited to HomePod.

The "market share" people are like some weird cult that imagine nothing but good comes from marketshare, and not being at the top marketshare is nothing but bad. This is completely wrong.

HP for example is the largest PC maker in the world, yet their margins are very low--so low that they want to get out of the business and have tried to sell their PC division. That's right, the biggest PC maker in the world doesn't want to make PCs. HP's customer satisfaction and reliability aren't great either, so you can't say that market share equates to customer satisfaction.

 

[Regime2008]

I doubt that, LOL. I say that as someone with an Anthony Gallo home theatre system and Focal car system with an Alpine amp.

Apple has NEVER been known for sound quality. Remember the iPod Hifi?

Ohhhh a car audio head! I love focal equipment! Moscani is another good one. What are you running?

 

[femike]

I would rather prefer a Homepod model without Siri, and have ...
Airplay 2
input jack
hard power switch
standard removable power cord
bluetooth 5.

 

[Rogifan]

Strategy Analytics has no idea how many HomePods Apple sold but rumor sites will print it anyway.

 

[Spizike9]

I’m happy with mine, it sounds great and no doubt Siri will be improved with future updates alongside Airplay 2 being added. Also I think considering they have only just entered into the smart speaker category that is a decent start.

People have been saying Siri will be improved for how many years now. Siri is one of Apple’s biggest fails.

 

[bladerunner2000]

Ohhhh a car audio head! I love focal equipment! Moscani is another good one. What are you running?

Amp: Alpine PDX-V9
Sub: Alpine SWR-8D4
Front Speakers: Focal Access 130 AS Component
Rear Speakers: Focal Auditor RCX 130
Deck: JVC KD-R900

All in a 2011 Subaru Impreza. Yah, you're probably thinking 'that's a pretty good setup but why a JVC deck?!' Well.... it's the only one that let's me plug in a USB drive and have all the files and folders show up in alphabetical order and let me scroll through the list of items real quick. I don't use a phone via bluetooth for music cuz I prefer to slap a USB drive into the deck and leave it. I've got a small 64gb samsung (link) drive thats barely bigger than the connector itself. It's small, discrete, I don't need to turn on bluetooth, don't need to fiddle with the phone and it starts playing when I turn on the car. SIMPLE.

 

[Shlooky]

If only the Homepod would be available in Canada and other countries, not sure whats the hold up!!!

 

[DevNull0]

People here said that about the iPhone X, A LOT and it was proven wrong 2 quarters in a row with actual data.

Apple actually released sales data about the iPhone X? Hmm, I must have missed that, can you provide a link, please?

 

[Dominicanyor]

I don’t think those numbers are accurate!!

 

[Heineken]

I Like mine, it's awesome. I wouldn't switch to google or amazon at gunpoint.

 

[Mtmspa]

I bought one to operate as a speaker from my phone, knowing that Siri was a steaming pile and not really caring about that aspect of it. The very first time I tried to play music from a playlist at a party, the music kept cutting in and out. This is about the most basic use case imaginable. What the hell, Apple?

User error?
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I Like mine, it's awesome. I wouldn't switch to google or amazon at gunpoint.

Same here.