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Slow Quarter for AirPods, Beats by Dre Offset the Decline

by Ville-Petteri Ukonaho | Oct 29, 2021

Apple released its latest quarterly numbers in 28.10.2021. Strategy Analytics followed the event closely and has dissected the numbers for you.

Apple Wearables, Home and Accessories revenue had a slow quarter growing 12% YoY. Apple managed to increase revenues for the sector only by 1% QoQ which is an unconventionally low result for Apple but not entirely unexpected. 

Apple’s AirPods earbuds (TWS) had a slow quarter. Shipments declined -3% YoY and grew only 2% QoQ. The slightly slowish quarterly growth gives a clear indication that the lineup is getting aged and consumers were already waiting for the refreshed AirPods 3 (launched in 4Q) and new AirPods Pro 2 (expected sometime in 1H 2022). AirPods TWS revenues declined -7%% YoY and grew 1% QoQ. With the launch of the new AirPods 3 we are expecting a better 4Q for AirPods TWS lineup.

Even though AirPods earbuds are still its bestselling audio accessory, Apple has also AirPods Max in its lineup. AirPod Max shipments fell from previous quarter by -14%, but the sales are coming from a quite low base as their high ASP limits sales. We expect AirPods Max also to have better Christmas quarter than what the third quarter was.

Apples audio focused subsidiary, Beats by Dre, launched their newest TWS (Beats Studio Buds) during 2nd quarter 2021 and it has been well received. Beats TWS shipments in third quarter grew 71% YoY and 69% QoQ which is an super excellent achievement. Beats TWS revenues were also on the rise and increased 21% YoY and 47% QoQ.

When we sum it all together we see that overall TWS shipments for Apple+Beats declined only -1% YoY (+4 QoQ) and revenues -5% YoY (+3% QoQ) so Beats success offset some of the sluggishness in AirPods shipments.

Headsets and earbuds have become a healthy segment for Apple and remained relatively resilient during the Covid-19 pandemic. We see that the ongoing chip shortage that is affecting iPhone shipments has an direct relation also to AirPods shipments as those are often purchased together. We do not expect AirPods shipments in 2021 to reach the 2020 levels. However, we are optimistic about 2022 when the chip shortage eases and AirPods Pro 2 is launched. We expect AirPods shipments to return to growth again next year.

Clients of our Bluetooth Device Tracker service can learn more about Apple and other vendors Bluetooth device shipments, sales, market share, ASPs, revenue and technology here.

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