Apple Lowers HomePod Forecasts and Cuts Orders Following Lackluster Sales [Report]

Apple has lowered its forecasts for the HomePod and cut orders for the smart speaker due to lackluster sales, reports Bloomberg.

At first, it looked like the HomePod might be a hit. Pre-orders were strong, and in the last week of January the device grabbed about a third of the U.S. smart speaker market in unit sales, according to data provided to Bloomberg by Slice Intelligence. But by the time HomePods arrived in stores, sales were tanking, says Slice principal analyst Ken Cassar. “Even when people had the ability to hear these things,” he says, “it still didn’t give Apple another spike.”

During its first 10 weeks of sales, the HomePod captured 10% of the smart speaker market, compared to 73% for Amazon and 14% for Google. Three weeks after launch, the HomePod slipped to about 4% of the smart speaker market. By late March, Apple lowered sales forecasts and cut some orders with Inventec, a source tells the site.


Veteran Apple analyst Shannon Cross says consumers assumed the HomePod would be able to do many of things the Echo and Google Home can do—answering questions, orderings pizzas and much more. Instead the HomePod is mostly limited to playing tunes from Apple Music, controlling a limited number of Apple-optimized smart home appliances and sending messages through an iPhone. That’s a serious disincentive, Cross says, when the Apple speaker costs $200 more than than most smart speakers.

Slice reports that during its pre-order weekend, the HomePod grabbed 72% of smart speaker revenue. In February and March that dropped to 19%, compared to 68% for Amazon, 8% for Google, and 5% for Sonos.

Apple is still planning to add features to the HomePod and sales could improve. Loup Ventures analyst Gene Munster expects sales of 7 million units this year and 11 million next year; although, that's significantly less than his expectations for Amazon and Google. Munster predicts Amazon will sell 29 million Echos in 2018 and 39 million in 2019. Alphabet is expected to sell 18 million Google Home devices this year and 32 million next year.

More details in the full report linked below...


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