Simone Marchetti wears Apple AirPods during Milan Fashion Week in Milan, Italy.
Melodie Jeng | Getty Images
Apple’s AirPods headphones could see shortages this holiday season after a surge of consumer demand, Wedbush analyst Dan Ives wrote in a note on Wednesday.
Ives estimates that Apple could ship 65 million AirPods in 2019, and potentially reach 85 million to 90 million units shipped in 2020.
The bullish note is another sign that Wall Street views Apple’s wireless earbuds as the latest successful product for the iPhone maker. Last month, analysts from Bernstein, Morgan Stanley, and Barclays pointed to AirPods sales growth as a highlight in Apple’s recent financial results.
Apple doesn’t break out sales of its various headphone lines, instead reporting them together in a category called “wearables,” which executives have said represents a strength for the company. The unit saw 54% growth in the quarter that ended in September.
Apple’s newest model, the $249 noise-cancelling AirPods Pro, are poised to be “a clear star of Black Friday and the holiday season,” Ives wrote.
“While AirPods today are on a trajectory to represent ~4%+ of overall revenues, this product category continues to speak to the unparalleled flywheel,” Ives wrote, citing the huge benefit of having more than 900 million iPhones and over 1.4 billion active devices on the market.
Apple’s website showed that a set of AirPods Pro ordered on Wednesday won’t ship until after Christmas. Nikkei reported on Wednesday that Apple has asked its manufacturing partners to double production of the AirPods Pro to 2 million units per month.
AirPods Pro are still in stock at retailers including Best Buy, Walmart, and Target. Demand for older AirPods models could be boosted by holiday discounts from retailers, Ives writes.
“We also expect price cuts on the older AirPods versions at various retail locations starting on Black Friday and especially on Amazon as we saw price points on AirPods 2 this afternoon were cut down to $134 (vs. the original $159 retail price) and will likely be lower on Friday morning,” Ives wrote.
Wedbush has an outperform rating on Apple stock and a $325 price target. The shares rose 1.3% on Wednesday to $267.84.
