Vision Pro: Apple’s sleek attempt to secure its future in a post-smartphone world

Launched at WWDC in Cupertino, Vision Pro is the company's first major product debut since the Apple Watch in 2015, with prices from $3,499

Apple chief executive Tim Cook with the company's Vision Pro headsets. AP

“Certain products shift the way we look at technology … you have never seen anything like this before,” Apple chief executive Tim Cook said as he unveiled the long-awaited augmented-reality headset Vision Pro this week.

Available next year, Vision Pro is the company's first major product launch since the Apple Watch in 2015 and is priced from $3,499.

Apple, which described the technology as its “most ambitious product”, reportedly hopes to sell three million devices in the first year, but industry experts expect fewer than 500,000 to be sold in the first 12 months because of the price.

But they said the company was not focused on the first year’s shipments and was not looking to compete with Facebook’s parent company Meta, Apple's closest competitor in the market.

Apple is looking to create a futuristic product and gradually make it mainstream, the experts said.

“At $3,499, the headset isn’t affordable for most consumers … this will be geared towards developers and other enterprise users who will go on to create consumer experiences later down the line,” said Jitesh Ubrani, research manager at International Data Corporation in Massachusetts.

“Apple purposely created a premium headset to offer the best experience on the market and at least with this generation of the headset they are likely OK to cede the low-end to Meta or other competitors."

Vision Pro will be available in the US early next year, but the launch failed to inspire investors.

Apple was trading about 0.78 per cent down at $177.82 a share at market close on Wednesday. It was 0.18 per cent down in pre-market trading on Thursday.

“Apple's focus with Vision Pro is not on first-year shipments, which we expect to be under half a million units,” Tarun Pathak, research director at Hong Kong-based Counterpoint Research, told The National.

“It is thinking about the next decade and beyond of technological evolution and how to secure its future in an eventual post-smartphone world … with its advanced specs and sleek design, despite of the weight and external battery pack, [it] is a good first step."

KGI Securities analyst Christine Wang said she expected shipments of 200,000 in the first year, while Credit Suisse predicted Apple could ship more than a million in that period, Reuters reported.

The company sold more than 1.4 million iPhones in the first year after launch, generating about $630 million in sales.

“The launch was more a teaser since the device will only be available next year,” said Annette Zimmermann, vice president analyst at Gartner.

“The device is targeted at early adopters who may already own or buy high-end Apple products. It is not targeted at families looking to buy a device for each family member.”

Ms Zimmermann said there were rumours that Apple would follow up with a cheaper device in the coming months.

The global augmented-reality headset market is expected to reach about $5.9 billion by 2030, from $4.1 billion last year, growing at an annual growth rate of 5.3 per cent between 2023 and 2030, according to business intelligence firm Vantage Market Research in Washington.

In the US, the augmented-reality headset market revenue is expected to hit $1.88 billion this year from $1.84 billion last year, Statista said.

The extensive application of virtual reality technology in retail and manufacturing industries drives market growth.

Overall, the global virtual reality market size, which was valued at $28.41 billion in 2022, is expected to expand at a compound annual growth rate of 13.8 per cent from 2023 to 2030, according to Grand View Research in San Francisco.

Apple also launched a new MacBook, its silicon chip M2 Ultra and the latest versions of operating systems for iPhones, iPads, Mac and Apple Watch at the Worldwide Developers Conference.

The company aims to boost its declining profits by adding new products to its portfolio, experts said.

“With Apple silicon, the focus will be on upgrades from Intel-based Macs, a realistic prospect likely to yield results for Apple even in the current economic scenario,” Mr Pathak said.

“Consumers are more cautious about spending given the current macroeconomic climate. However, Apple is in a unique position as many of their consumers are part of higher-income households, and these households typically are less impacted by economic downturns,” Mr Ubrani said.

“The OS upgrades for iPad and iPhone seem to be more incremental though, and are likely not going to have a big impact on growing Apple’s user base."

The company posted quarterly revenue of $94.8 billion, down 3 per cent annually, in three months to April 1. Its net profit dipped 3.4 per cent yearly to $24.1 billion during the period.

“We forecast a weak year [2023] for notebooks both large and ultra-thin … we are expecting a market decline between 9 per cent to 12 per cent year over year. User demand is expected to be weak for the rest of the year due to worries about a looming recession,” Ms Zimmermann said.

Apple launched a 15-inch laptop, priced from $1,299, on Monday.

Global shipments of PCs, which included laptops, desktops and tablets, stood at 56.9 million in the first quarter, down nearly 29 per cent on an annual basis, according to IDC.

Apple occupied 7.2 per cent of the PC market in the first quarter. It shipped 4.1 million computers in the January-March period, nearly 40.5 per cent less than it sold in the same period last year.