AirPods, Apple Inc.’s (AAPL) Bluetooth headphones, should fly off the shelves next year because increased supply will make them much easier for consumers to buy, according to KGI Securities.
In a note obtained by MacRumors, Taiwan-based analyst Ming-Chi Kuo estimated that Apple will ship 13 million-14 million AirPods this year, followed by 26 million-28 million in 2018. Kuo's prediction that the company will double sales next year is driven by his understanding that the wireless headphones, which he described as one of Apple’s most “popular accessories,” are now more readily available.
AirPods debuted in December 2016. However, shipments of the $159 headphones were modest due to supply issues. Until August 2017, consumers ordering AirPods on Apple’s website faced a six-week wait.
Kuo said those issues have now been ironed out after Apple reached out to China-based Luxshare to become the main assembler of AirPods. Since that change, manufacturing capacity has been increased, Kuo added, meaning that AirPods can now be bought with just few days of shipping.
“We believe demand for AirPods has been strong, and note that the shipping time of the product on Apple's official shopping website has shortened to 1-3 days, mainly thanks to an improved assembly process and increased capacity from Luxshare as the new assembler,” he said. “We expect AirPods to remain one of the most popular Apple accessories in 2018, with shipments likely to rise 100 percent year-over-year to 26-28 million units.”
Apple doesn’t breakdown AirPods sales. Instead it groups the wireless headphones under its “other products” category, which includes Apple TV, Apple Watch, Beats, iPods, and other accessories. Last quarter, the company grew revenues 36 percent year-over-year to $3.2 billion in this category. (See also: Why Apple Could Reach $1 Trillion Next Year.)
Judging by what CEO Tim Cook said on during the earnings call, AirPods played an important role in this success. “The combination of music streaming on Apple Music and AirPods is truly a magical experience for people on the go,” he said on the call, according to MacRumors. “We're thrilled with the momentum of these products. In fact, our entire wearables business was up 75 percent year over year in the fourth quarter, and in fiscal 2017, already generated the annual revenue of a Fortune 400 company.”
MacRumors also mentioned that Apple is planning to launch a new case designed to enable users to charge AirPods wirelessly alongside an iPhone and the Apple Watch. The AirPower charging mat is expected to be released early next year. (See also: Apple Seeks Patent for a Foldable Phone.)