Apple Watch preorders estimated at 2.3M units, low supply blamed on haptic vibrator and OLED display
Well-informed KGI analyst Ming-Chi Kuo, who has in the past proved accurate in predicting Apple's moves, estimates Apple Watch preorders will exceed 2.3 million units, though production bottlenecks relating to the device's haptic vibrator and advanced OLED screen are restricting rollout.
In a research note obtained by AppleInsider, Kuo said mass production of Apple Watch started in March and should reach output of 2.3 million units by the end of May, taking current delivery times into consideration.
By model, Kuo estimates 85 percent of orders will go to Apple Watch Sport, 15 percent to stainless steel Apple Watch versions and 1 percent to pricey solid gold Apple Watch Edition iterations.
Considering Apple's current supply chain capacity and future expansion plans, the analyst is targeting production at 2 to 3 million units per month, with output potentially topping out at 2.5 million units in June.
Existing limitations could hinder accelerated manufacture, however. Currently, Apple is seeing restricted supply of vibration motors from Hong Kong-based manufacturer AAC and flexible AMOLED screens from LG Display, which is said to be Watch's sole display supplier. Powering Apple Watch's Taptic Engine, AAC's motors must meet stringent operating requirements that require a smaller form factor than iPhone vibrators, while being more accurate. Technical hurdles for LG include AMOLED panel color accuracy and life span.
With iPhone shipments currently pegged between 50 to 60 million units per quarter, Kuo believes less than ten percent of Apple handset owners preordered Apple watch. However, preorder estimates indicate Apple Watch is seeing better shipments momentum than competing devices.
Given supply chain bottlenecks and time to ramp up consumer demand, Kuo estimates Apple to ship between 15 and 20 million Apple Watches in 2015, well below Street consensus of 20 to 30 million units.
In a research note obtained by AppleInsider, Kuo said mass production of Apple Watch started in March and should reach output of 2.3 million units by the end of May, taking current delivery times into consideration.
By model, Kuo estimates 85 percent of orders will go to Apple Watch Sport, 15 percent to stainless steel Apple Watch versions and 1 percent to pricey solid gold Apple Watch Edition iterations.
Considering Apple's current supply chain capacity and future expansion plans, the analyst is targeting production at 2 to 3 million units per month, with output potentially topping out at 2.5 million units in June.
Existing limitations could hinder accelerated manufacture, however. Currently, Apple is seeing restricted supply of vibration motors from Hong Kong-based manufacturer AAC and flexible AMOLED screens from LG Display, which is said to be Watch's sole display supplier. Powering Apple Watch's Taptic Engine, AAC's motors must meet stringent operating requirements that require a smaller form factor than iPhone vibrators, while being more accurate. Technical hurdles for LG include AMOLED panel color accuracy and life span.
With iPhone shipments currently pegged between 50 to 60 million units per quarter, Kuo believes less than ten percent of Apple handset owners preordered Apple watch. However, preorder estimates indicate Apple Watch is seeing better shipments momentum than competing devices.
Given supply chain bottlenecks and time to ramp up consumer demand, Kuo estimates Apple to ship between 15 and 20 million Apple Watches in 2015, well below Street consensus of 20 to 30 million units.
Comments
If true, there are almost 3X more pre-orders for the Apple Watch than the original iPhone sold during 3 full months after launch.
Wow, what a fail.
/s
I had predicted 2 million a few weeks ago, but I know how where that came from. How do we know Kuo did not produce it from the same place?
By model, Kuo estimates 85 percent of orders will go to Apple Watch Sport, 15 percent to stainless steel Apple Watch versions and 1 percent to pricey solid gold Apple Watch Edition iterations.
And here we go again. 101% guess
Did you notice any lag when opening apps or were you even able to do that? I ask because one reviewer that wore it a week said it was sometimes slow to respond. Curious to see what others that have used it thought. I'm also assuming there will be lots of software updates by the time it actually reaches people.
If true, wow. In line with my guess based on the other estimate that 1 million preorders from the U.S. at launch. I assume China and the othe countries could have pulled another million.
All other sources confirm only 957K pre-orders in the U.S., not a million.
So it looks like Wall Street will be wrong...uh, I mean disappointed again.
Ming-Chi Kuo has excellent connections and his analytic ability is great as well. So believe what he says.
Are you joking? He yaps most of the same crap all other analysts yap. I don't believe ONE SECOND, there is a problem with the Oled, no one second. I could possibly believe it for the other component, but the yield is getting old.
Myself. I bet there is not yield issue at all, just production not adapted to demand. Is it because they didn't plan enough capacity, or because demand is too high, we will know eventually. I get a feeling the actual numbers are higher than 2.3M, more like 3-4M.
Did you notice any lag when opening apps or were you even able to do that? I ask because one reviewer that wore it a week said it was sometimes slow to respond. Curious to see what others that have used it thought. I'm also assuming there will be lots of software updates by the time it actually reaches people.
I played with one today. Didn't notice any lag, but I was only using builtin apps. I think the reviewer was referring to third party apps having lag. The demo watches don't have any third party apps.
If true, there are almost 3X more pre-orders for the Apple Watch than the original iPhone sold during 3 full months after launch.
Wow, what a fail.
/s
Apple did 957K pre-orders for the Apple Watch during the launch. Apple sold one million iPhones in 2 1/2 months, more if you add an extra two weeks for your 3 month example. How is 957K three-times more than one million?
It is amazing how clueless you are. You can't even get your own Apple fanboy facts right. No wonder no one believes the stuff you write. Apple did 957K pre-orders for the Apple Watch during the launch. Apple sold one million iPhones in 2 1/2 months, more if you add an extra two weeks for your 3 month example. How is 957K three-times more than one million? Did you fail math? It sure sounds like you did.
I don't know where you got the 957k figure, but Slurpy was clearly talking about the 2.3MM figure.
I played with one today. Didn't notice any lag, but I was only using builtin apps. I think the reviewer was referring to third party apps having lag. The demo watches don't have any third party apps.
The demo watches are not paired to an iPhone. They are special watches that only work in a demo mode. That is why there was no lag when you played with it. I played with one too. The screen is pretty small for navigating the tiny icons. Reading text on the small screen for any notification was not really a good experience. Who knows what it would look like in bright sun light, something an iPhone and iPad have never been good at. They all look nice in the store under controlled lighting. I only saw two people trying one on for real, and that was Saturday afternoon. Read some reviews. One said you had to shake your wrist a few times before it would wake up to show the time, a task that grew annoying anytime you wanted to see the time. If you glanced at your wrist to see the time, not going to happen unless you shake your wrist or use your other hand to wake it up. Not something people want to do when they just want to see the time.
Here is the article that explains how the store watches function:
http://arstechnica.com/apple/2015/04/trying-on-some-apple-watches-and-getting-the-cushy-edition-treatment/
I don't know where you got the 957k figure, but Slurpy was clearly talking about the 2.3MM figure.
According to the article, 2.3M watches have NOT been pre-ordered. That was the crazy analyst's ESTIMATE of what he thinks might sell. Big difference. The 957K figure is reported everywhere but here. Go figure.
https://screen.yahoo.com/957k-apple-watches-sold-over-181924635.html
Estimate or not, that was the number Slurpy was talking about. Notice how he prefaced his post with "if true". It's a bit disingenuous to compare his post with a completely unrelated number then criticize his math.
All other sources confirm only 957K pre-orders in the U.S., not a million.
Oh, right "sources", unless the source is Apple, the precision of this "info" is laughable. It could be 1.5 or 900K, who knows but saying it is 957K with certainty is a hoot!
According to the article, 2.3M watches have NOT been pre-ordered. That was the crazy analyst's ESTIMATE of what he thinks might sell. Big difference. The 957K figure is reported everywhere but here. Go figure.
https://screen.yahoo.com/957k-apple-watches-sold-over-181924635.html
Hey, BUDDY, these are ALL ESTIMATES pulled from someone's derriere. That you think that 957K (why not 960K) is actually close to an exact number makes me think your looking to push some buttons.