The iPhone maker is now reportedly forecasting 75 to 85 million units for 2021, down from the original forecast of 110 million units.
“The most significant order reduction is for the second quarter toward the start of the third quarter,” said one source to Nikkei. “The levels of inventory [in warehouses] and in-store stocks of AirPods are currently high … and demand is not as strong as expected.”
Sources added Apple is hoping for increased sales of AirPods when newer versions are set to be introduced in 2021.
Counterpoint Research data says Apple sold roughly 73 million units of AirPods in 2020, taking a dominate 31% share of the Bluetooth wireless headphones market. Apple’s lead in marketshare has lowered from 60% in 2018 down to 31% in 2020, due to competition to AirPods.
“It is not possible to grow 30%, 40%, 50% by shipments every year for a long time. At some point the growth will slow down and normalize,” said an unnamed executive-level source to Nikkei. “The time of high growth for AirPods might be past.”
Last month, Apple analyst Ming-Chi Kuo said production of Apple’s next-generation AirPods would start in Q3 of this year.