Losing Sight of the Vision Pro
郭明錤 (Ming-Chi Kuo)
With the potentially large caveat that this data is based off of a survey that Ming-Chi Kuo runs, even if this is directionally accurate, big yikes for Apple:
Apple has cut its 2024 Vision Pro shipments to 400–450k units (vs. market consensus of 700–800k units or more).
Yes, that's nearly in half. And that number was already cut from earlier estimates. Again, these numbers aren't from Apple (obviously) and it's entirely possible that analysts who extrapolate such things were just way off to begin with in terms of expectations. But come on. I own the device. Some of you own the device (though clearly not as many as Apple would like!). This was all pretty easy to see as it's pretty problematic at the moment.
Beyond the fact that it's a big pain in the ass to use versus say, the iPhone, iPad, or Mac, Apple has really underperformed in creating a steady cadence of content for you to use on the device. That's the thing, it's so cumbersome to actually start using the device that it's on Apple to give us reasons to pick it up, quite literally.
And there are clear reasons – 3D movies, for one, are awesome on the device. But when Dune Part 2 came out last week, I immediately booted up the Vision Pro to watch it and... it wasn't available in 3D. I have absolutely no idea why since the first Dune is right there in 3D. Maybe it's a rights issue, or maybe a technical one. It doesn't matter, it needs to be there for the Vision Pro. Apple should have moved Arrakis and Caladan to get it in 3D on the Vision Pro upon digital release.
Apple just sent out a marketing email yesterday touting 3D movies in the headline. "Dive into 3D movies with Apple Vision Pro." Apple acquired the rights for Apple TV+ members with Vision Pros to watch some great movies in 3D – they clearly know this is a killer use case. Where is Dune 2?!
Even better than 3D movies is Apple's own "Immersive Video" format. It seems like Apple also knows this is a key selling point of the Vision Pro – duh – and has gone through a slight branding exercise to label such content as "Apple Immersive". Great. Now give us about 10x the amount of content available today. There are literally only a half dozen videos right now. And they're all five to ten minutes long.
Apple just released a new episode of "Prehistoric Planet Immersive" last week. Oddly, they didn't tout it – at least I didn't see it anywhere. But there it was when I put on the Vision Pro last night. It's great – you get to see a cute baby triceratops stumble around. It's also way too short at five minutes.
I won't even bring up the soccer thing except to quip: YOU'RE DROPPING THE BALL APPLE.
The company undoubtedly thought that third-party developers would help carry the water for the device in these early days, but there are so few apps tailored for the Vision Pro. And big new launches have been few and far between. Who is minding the store, literally?
Look, we all knew the Vision Pro wasn't going to be a blockbuster out of the gate simply due to its $3,500 price point. But Apple has squandered the opportunity it had to leverage the early adopter buzz around the device to keep it moving in respectable numbers until they can get a second iteration out the door. Again, I'm sure no one inside Apple thought this would be the next iPhone on day one – or even the next iPad. Maybe the next Apple Watch was a more reasonable hope in terms of revenue, if not volume, thanks to that price point. Regardless, Apple didn't ship the device to not sell it. And yet we keep creeping closer to them not really selling it in any sort of interesting volume.
Yes, there will be forthcoming international launches. But those markets have to be looking at the US and thinking: what is going on here?
Apple cut orders before launching Vision Pro in non-US markets, which means that demand in the US market has fallen sharply beyond expectations, making Apple take a conservative view of demand in non-US markets.
Not good. And finally:
Apple is reviewing and adjusting its head-mounted display (HMD) product roadmap, so there may be no new Vision Pro model in 2025 (the previous expectation was that there would be a new model in 2H25/4Q25). Apple now expects Vision Pro shipments to decline YoY in 2025.
Emphasis mine. Really not good.
To say it will be interesting to hear what Apple says about the Vision Pro in their earnings call next week is an understatement. I'm guessing they'll tout some forward-looking bits about international launches as well as the new "Spatial Persona" functionality – which is legitimately well done and legitimately should have been a launch feature. Will we get the usual "demand for the device is exceeding our expectations"? I'd be shocked if we don't because that doesn't really say anything. It's the verbal equivalent of a chart without a Y-axis.
But specific numbers aside, Apple needs to rethink their strategy here. It may not be "AI, AI, AI, AI, AI, AI" but it's a major product they shipped which seems to be gathering some dust in many of our houses. Not a good look for a device which already doesn't make you look good.
Update April 25, 2024: A number of folks have noted that the reason Dune Part 2 isn't available in 3D on the Vision Pro is likely because it was never converted/made for that format for theaters (which apparently fhe first Dune was). Still, were I Apple, I would probably pay for such a conversion myself -- especially since again, the first one is available in the format and looks wonderful.