Intelligent hardware

It is estimated that in 2021, the volume of air pods will be about 75-80 million From Guo Mingfu

The following is the It is estimated that in 2021, the volume of air pods will be about 75-80 million From Guo Mingfu recommended by recordtrend.com. And this article belongs to the classification: Intelligent hardware.

[Apple research] in 2021, the shipment volume of airpods may decline; the main loser of airpods; new thinking of TWS investment

Forecast update: air pods shipment, major losers and new thinking of TWS investment

Major companies:

Changdian Technology (600584. SS)

Huanxuan Technology (688608. SS)

Huatong (2313. TW)

Wang Hua (2367. TW)

MediaTek (2454. TW)

Ruiyu (2379. TW)

Zhiwei (4925. TW)

Apple (AAPL.O)

Amkor (AMKR.O)

1. We forecast that in 2021, the volume of air pods will decline. If the demand for the new type of airpods 3, which is expected to ship in large quantities in 3q21, is lower than the market expectation, investors’ attention to airpods will further decline.

2. Fierce competition and lack of ecological protection are the main reasons for the decline of air pods shipment, and the main losers are SMT solution providers Huatong and Jihua.

3. The TWS market is still growing, but the focus of investors may gradually shift from airpods to non airpods.

We reduce the forecast of air pods shipment in 2021 by 30 – 35% to 75 – 80 million units, which means that it will decline by 10 – 15%. We are different from the market consensus, which is that in 2021, the number of airpods will grow by 25 – 30% YoY to 110 – 120 million.

Our latest survey shows that the shipment volume of airpods 1 – 3q21 will decline by about 25% to 55 million units, even if the market demand of new-type airpods 3 is expected to be better than expected, and the shipment volume of 4q21 airpods will be flat to 23 million units, and the shipment volume of airpods will decline to about 78 million units in 2021 (vs. 90 million units in 2020).

In terms of product mix, we predict that the shipment volume of airpods 2 in 3q21 will decrease significantly to about 3 million units (vs. 12 million units in 3q20). We believe that the main reason may be due to product conversion. In our opinion, it is still difficult to determine whether the production of airpods 2 will end after the mass production of airpods 3. Apple’s dilemma is that if airpods 2 is sold at a lower price, it may affect the demand of airpods 3, but if there is no cheaper airpods model, it will not affect the shipment of airpods.

The new airpods Max has limited help to the shipment of airpods, with an annual shipment of about 1 million units.

If the production of airpods 2 stops after a large quantity of airpods 3 is shipped, we estimate that the proportion of airpods 3, airpods pro, airpods 2 and airpods Max will be about 40%, 28%, 31% and 1% respectively in 2021. If the production of airpods 2 continues after the bulk shipment of airpods 3, we estimate that the shipment proportions of airpods 3, airpods pro, airpods 2 and airpods Max will be about 32%, 28%, 39% and 1% respectively in 2021

We believe that the reason for the decline of airpods shipment is that when it is difficult for hardware selling points to differentiate from competitors’ low-cost products, there is a lack of strong ecology to protect the growth of shipment.

Due to the rapid growth of TWS market in recent years, the fierce competition faced by airpods leads to the simultaneous decline of shipment volume and market share. Our latest survey shows that the TWS market of 4q20 has grown by about 45% YoY, while the market share of 4q20 of airpods has declined to about 30% (vs. 40% of 4q19).

TWS low-cost models are growing rapidly. Our latest survey shows that more than 50% of the top 10 TWS models sold in the world sell for less than US $50 (vs. US $149 of the cheapest models in air pods). We believe that the growth rate of low-cost models continues to accelerate.

The key to the early success of airpods lies in the ease of use and high quality of the Bluetooth connection provided by TWS. Although at present, airpods is still ahead of its competitors in these two aspects, its advantages are gradually offset by competitors’ gradually improved user experience and low price strategy. In terms of high quality, although the low delay of airpods Pro is about 50% and 20% better than that of airpods 1 and 2 respectively, and it provides active noise reduction function, from the sales results, consumers are not willing to pay more than $100 for airpods pro.

The competitive advantage of Apple products is to provide an ecosystem of “integration of hardware, software and services”, not just hardware. Take the iPhone as an example. Although its market share has declined due to the rapid growth of the smart phone market, it can still maintain the shipment growth due to the strong ecology of app store and developers. We believe that Siri is the core of software and service ecology of airpods. However, because Siri’s competitive advantage is not significant, when competitors gradually improve their user experience and launch low-cost strategies at the same time, airpods’ leading advantage gap narrows due to lack of ecological protection. In our opinion, the significantly lower than expected shipment volume of homepod and homepod Mini is also caused by the same reason.

We believe that in order to grow again in the future, we need to have a strong ecosystem, or redefine TWS user behavior through hardware innovation (such as providing health management function).

TWS market is still growing, but the focus of investors will gradually shift from airpods to non airpods.

If the market demand of the new airpods 3 is not better than the market expectation, the market’s investment focus on airpods will further decline.

The decline of airpods shipment is unfavorable to the revenue and profit of the supply chain. As airpods 3 will abandon SMT and adopt SIP solution, the air pods business of SIP supplier Amkor and Changdian technology will still offset part of the decline in shipment due to design conversion, while SMT solution suppliers Huatong and Yaohua will be the biggest losers, and the momentum of these two companies’ air pods business will be further negatively affected due to the decline in shipment.

When the investment sentiment is not favorable for airpods, we think that even the new suppliers of airpods will not easily attract the attention of investors in the future.

Despite the rapid growth of non airpods, due to the fierce competition in the downstream, we believe that the long-term investment value in the upstream is generally better than that in the downstream, and we suggest investors pay attention to the long-term trend of main chip suppliers, including: Qualcomm, Luoda / Lianfa, Ruiyu, Zhiwei and huanxuan technology.

Investment suggestions:

TWS market is still growing rapidly, but the focus of investors will gradually shift from airpods to non airpods. The decline of airpods shipment is unfavorable to the revenue and profit of the supply chain, while Huatong and Yaohua, the SMT solution suppliers, are the biggest losers.

Risk tips:

New product deferred novel coronavirus pneumonia and demand for new pneumonia are lower than expected.

More reading: Guo Mingwei: the shipment of airpods in 2020 is about 80-90 million. Guo Mingwei: it is estimated that the shipment of airpods in 2020 will be 80-90 million. It is estimated that the shipment of Shanzhai airpods in 2020 will reach 600 million. Tianfeng International: it is estimated that the total shipment of airpods in 2021 will reach 120 million 28% year-on-year growth: it is estimated that Apple’s air pods shipment will reach 28 million sets in 2018, and the global sales of Apple’s air pods will reach 15 billion US dollars in 2020 Apple’s market share will drop to 35% counterpoint: Q2 Apple’s market share will drop to 35% counterpoint: Q3 Apple’s ears will account for 29% of the total shipment of true wireless stereo (TWS) headphones in 2020 Apple’s airpods will occupy 26% of the U.S. Wireless Headset Market in 2016. Guo Mingxiang: Huawei’s mobile phone sales are expected to reach 215-225 million units in 2019. Guo Mingxiang: Huawei’s mobile phone market share in China is expected to reach 50% in 2020. Guo Mingxiang: Huawei’s mobile phone sales are expected to reach 260 million units in 2019. Guo Mingxiang: Q1 iPhone shipments are expected to reach 38-42 million units in 2019

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