AR Headset’s Estimated Revenue Suggests Apple’s First Model Will Only Ship One Million Units, Product Labeled A ‘Dud’

Apple is somehow being pressured into launching its first AR headset as early as possible, but despite an early inception, one report states that the mixed-reality wearable is only expected to ship one million units in the year. These estimates reveal that the device will not garner as much revenue as Apple’s other products, with the same report calling the product a ‘dud’ when compared to others.

Apple reportedly making ‘little to no profit’ with the AR headset launch

With a rumored price of $3,000 and one million units estimated to be shipped this year, the total revenue for this one product will be $3 billion, according to Bloomberg’s Mark Gurman. In his ‘Power On’ newsletter, Apple will make little to no profit with the release, suggesting that the main objective of the AR headset launch would be to ensure that the technology giant brings it to the market before its competitors to obtain a substantial foothold.

“The company believes it can sell about a million units of the headset — likely to be dubbed the Reality Pro or Reality One — in its first year. At $3,000, that would mean revenue of about $3 billion. There would be little to no profit at first, given that the components in the device are so expensive and Apple won’t be seeking its typical margins just yet.”

However, even with the launch advantage, the AR headset is labeled a ‘dud’ by Gurman, in part due to its high price but also because the market has not matured to receive a product like this. With Apple’s second model, which is also said to be cheaper, perhaps the company’s customer base will increase.

“In terms of unit sales, the first version will look like a dud next to the company’s existing products. It’s still likely to make Apple the market leader in mixed reality within a few months, but that’s just sign of how weak the current market is.”

Gurman also compares the AR headset to the Apple Watch but believes that it is hard to justify this comparison. Before Apple announced its first-ever smartwatch, the wearable industry stood at $10 billion, and now, with the latest fiscal year, it stands at $41.2 billion. One reason for the Apple Watch’s success is that it is included in the company’s home and accessories category, which includes products like AirPods, Apple TV models, watch bands, and more.

As a standalone product, the AR headset’s estimated $3 billion revenue for 2023 is not a bad start, but in contrast with other Apple-branded devices, the difference is night and day. However, it is possible that the second iteration should change the market’s reception, especially with Apple’s impressive software synergy with its other products.