Kuo: AirPods 3 Mass Production to Start in Q3 2021

[MacRumors]

Mass production will begin on the third-generation AirPods in the third quarter of 2021, according to an investors note from analyst Ming-Chi Kuo that was seen by MacRumors.

If mass production is not set to begin until the third quarter of 2021, it would mean that the AirPods 3 wouldn't ship until later in the year. Kuo previously said back in November that the AirPods 3 would launch in the first half of 2021, and other rumors have suggested the new AirPods could come as soon as this month.

There have been several leaks depicting the redesigned third-generation AirPods, which normally suggests that a launch is close, and Kang, a well-respected leaker who often shares accurate information about Apple's plans, said recently that the AirPods 3 are "ready to ship."

Kuo expects AirPods shipments from the first quarter of 2021 to the third quarter of 2021 to decline by about 25 percent year over year to 55 million units. Should demand for the AirPods 3 be better than expected, fourth quarter AirPods shipments will remain flat year over year at 23 million units. Overall AirPods shipments across 2021 are expected to decline to 78 million units, down from 90 million in 2020.

Kuo says that the AirPods Max have offered "limited help" to AirPods shipments, with an annual shipment of about one million units.

It is unclear at this time if AirPods 2 will stop being produced when the AirPods 3 enter mass production. Kuo says that Apple has a dilemma -- if AirPods 2 stick around and are sold at a lower price, it could affect AirPods 3 demand, but if there's a no low-priced AirPods model, it could have a negative effect on Apple's sales.

If AirPods 2 will go to end-of-life after AirPods 3's mass production, we estimate AirPods 3, AirPods Pro, AirPods 2, and AirPods Max will account for about 40%, 28%, 31%, and 1% of total shipments, respectively, in 2021. If AirPods 2 will continue production after mass production of AirPods 3, we estimate AirPods 3, AirPods Pro, AirPods 2, and AirPods Max will account for about 32%, 28%, 39%, and 1% of total shipments in 2021, respectively.

Kuo attributes the decline in AirPods shipments to increased competition and a loss of market share. There are a number of lower-priced true wireless earbud options on the market for Apple to contend with.

The competitive advantage of Apple's products lies in providing integration of the "hardware, software, and service" ecosystem, not just hardware. The iPhone, for example, has seen its market share decline due to the rapid growth of the smartphone market, but it has been able to maintain shipment growth because of the strong ecosystem of the App Store and developers. We believe that Siri is the core of AirPods' software and service ecosystem, but since Siri's competitive advantage is not significant, the gap between AirPods' leading edge and its competitors' shrinks due to a lack of protection from the ecosystem as competitors gradually improve their user experience and launch lower-price strategies at the same time. We believe that HomePod and HomePod mini shipments were significantly lower than expected for the same reason.

AirPods have quick pairing and fast switching capabilities that give them an edge over competitors, but Kuo says that these advantages are "gradually offset" by improved user experiences and lower prices offered by competitors.

In terms of high quality, while AirPods Pro's low latency is about 50% improvement vs. AirPods 1 and 20% improvement vs. AirPods 2, and it offers active noise cancellation, sales results show that consumers are not very willing to spend more than US$100 to buy the selling points of AirPods Pro.

Kuo says that if Apple wants to improve AirPods shipments in the future, hardware innovation like health management functionality is necessary to differentiate the earbuds from similar products offered by competitors.

Article Link: Kuo: AirPods 3 Mass Production to Start in Q3 2021

 

[RamalTheCamel]

For all the hype about these 3rd Gen AirPods from all of these leakers I expected these to come out at least in a 3 month window :/

 

[il_teo77]

Apple should stop stuffing so many releases together at the end of the year. iPad, iMac, MacBook Pro and the like could be released at any time. They mostly are not Christmas gifts but rather tools for professionals as well.

 

[GizmoDVD]

Apple should stop stuffing so many releases together at the end of the year. iPad, iMac, MacBook Pro and the like could be released at any time. They mostly are not Christmas gifts but rather tools for professionals as well.

I’m sure Apple knows exactly when the best time to release products is. They are experts.

 

[thomas040]

Who else think they are gonna come with health features, such as 'in ear body temperature meter' ? Basically the AirPods could tell you about a fever before you'd feel symptoms.

 

[bobmans]

Who else think they are gonna come with health features, such as 'in ear body temperature meter' ? Basically the AirPods could tell you about a fever before you'd feel symptoms.

Probably reserved for a future iteration of the airpods pro. Doubt they would introduce features like that in the regular airpods, but I assume something like that is definitely going to happen within the next few years.

 

[TheYayAreaLiving 🎗️]

Gotta wait till Fall 2021!

 

[Jony Ive and Co.]

My greatest respect to the wild successes of AirPods since their launch and they are miles ahead of any other truly wireless headphones, but there's no denying that over the past couple of years the competition has greatly improved and the gap is starting to shrink.

 

[LFC2020]

Next thing he'll say the march event is happening 😱😱😱

 

[glindon]

I think it introduced a lot of people to wireless earphones that “didn’t suck” who otherwise wouldn’t have bought wireless headphones. Once you own a pair, other than them being lost/stolen, or the battery finally giving out there really isn’t any need to upgrade like there is with a phone or computer.

 

[SWAON]

I'm more interested about AirPods Pro next gen, what they will bring...

 

[AmazeSE]

Kang vs Kuo. Who will be right?

 

[code-m]

I'm more interested about AirPods Pro next gen, what they will bring...

Hopefully a better fit with "fins", I believe both the AP3 and APP2 can incorporate this into its design and rechargeable case housing.

 

[contacos]

They are convenient but too much of a electronic waste kind of product. I learned my lesson and will make sure that if I ever get another generation of AirPods, to put AppleCare+ on them. My first gen last about 30 minutes and the left one already died twice. My AirPod Pro also have been replaced once (thankfully I was still under warranty)

 

[CarpalMac]

I’m sure Apple knows exactly when the best time to release products is. They are experts.

Indeed. I wonder though how trapped (if at all) they feel by the YoY expectation of growth during that quarter. I'd be surprised if it wasn't at least in small part a consideration.

 

[kerr]

I’m sure Apple knows exactly when the best time to release products is. They are experts.

How are HomePod sales going?

 

[44267547]

If they continue to use the gel tip design (Which I expect they will for ANC), then it’s a no-go for me. The in-ear design actually provided more of a discomfort for me after about 30 minutes of use. What I prefer about the regular AirPods, is they actually rest in the outermost portion of your ear. But nonetheless, a great device that has loads of potential for future upgrades.

 

[Realityck]

Apple should stop stuffing so many releases together at the end of the year. iPad, iMac, MacBook Pro and the like could be released at any time. They mostly are not Christmas gifts but rather tools for professionals as well.

Perhaps manufacturing slowdowns during the pandemic has caused this grouping of many product releases. You also have Apple likely wanting to discuss these product revisions in their WWDC 2021.

 

[Kylo83]

Time to sop listerning to jon and Iupdate

 

[shabagiuly]

How are HomePod sales going?

It wasn’t a question of time for the HomePod.

 

[The Game 161]

kuo has alot on the line here if he is wrong won't help his case for his other huge amount of leaks

 

[newyorksole]

I find it odd that they won’t be released until the third quarter...

I feel like they’ll come out this month the way the leaks are happening.

 

[opiapr]

Kang vs Kuo. Who will be right?

My money is on Kang.

 

[ansinkhh]

? is it just me or there’s been so much hype about all things Apple that...I...just...don’t really care...anymore (except M1X MBP — hurry up!)

 

[SirAnthonyHopkins]

How are HomePod sales going?

What has that got to do with the timing of the release?