Corroborating a report from Bloomberg from earlier today, a new report from China claims that Apple has reduced its HomePod shipment forecast for the second quarter to 200,000 — down from the 500,000 forecast it had in the first quarter. Additionally, the company is also reducing its HomePod shipment forecast for the entire year.
The reduction in HomePod sales forecast has affected suppliers that supply Apple with the required components including Inventec, Ruiyi, and Taichi.
There can be multiple reasons behind Apple cutting down on HomePod’s shipment forecast. One must keep in mind that the HomePod has now been on the market for a few months so it is obvious that there will be a reduction in its overall shipment as the hype around it has largely died down with interested consumers already getting their hands on it.
There are multiple reasons as to why the HomePod is not doing as well as analysts had expected. Firstly, its available in only a limited number of markets thereby greatly limiting its potential consumer base. Secondly, one must already own an iOS device before they could use an HomePod which further narrows down its potential consumer base. Further, HomePod has many limitations that you will not find on other smart speakers, including being limited to only Apple Music. Then, there’s also the fact that Siri on the HomePod is simply not as good as its competition.
The final nail in the coffin is the high price of the HomePod. At $349, the HomePod is just too expensive for consumers to go out and buy it on a whim especially with its various other limitations. In comparison, Google and Amazon’s smart speaker offering starts from $50 (or even lower) which easily falls under the impulse buy category. Apple does justify the high price of the HomePod with its stellar sound quality, but that alone is not going to be sufficient for most. Plus, it targets a niche set of customers who are looking for the best sound quality from their smart speaker.
Apple can obviously improve the HomePod with future software updates. In all likelihood, the company should announce some major improvements to Siri for the HomePod at WWDC 2018 this year which should help spur the sales of the smart speaker again.
[Via China Times]