Kuo: AirPods 3 Mass Production to Start in Q3 2021

Mass production will begin on the third-generation AirPods in the third quarter of 2021, according to an investors note from analyst Ming-Chi Kuo that was seen by MacRumors.

AirPods Gen 3 Feature
If mass production is not set to begin until the third quarter of 2021, it would mean that the AirPods 3 wouldn't ship until later in the year. Kuo previously said back in November that the ‌AirPods 3‌ would launch in the first half of 2021, and other rumors have suggested the new AirPods could come as soon as this month.

There have been several leaks depicting the redesigned third-generation AirPods, which normally suggests that a launch is close, and Kang, a well-respected leaker who often shares accurate information about Apple's plans, said recently that the AirPods 3 are "ready to ship."

Kuo expects AirPods shipments from the first quarter of 2021 to the third quarter of 2021 to decline by about 25 percent year over year to 55 million units. Should demand for the ‌AirPods 3‌ be better than expected, fourth quarter AirPods shipments will remain flat year over year at 23 million units. Overall AirPods shipments across 2021 are expected to decline to 78 million units, down from 90 million in 2020.

Kuo says that the AirPods Max have offered "limited help" to AirPods shipments, with an annual shipment of about one million units.

It is unclear at this time if AirPods 2 will stop being produced when the ‌AirPods 3‌ enter mass production. Kuo says that Apple has a dilemma -- if AirPods 2 stick around and are sold at a lower price, it could affect ‌AirPods 3‌ demand, but if there's a no low-priced AirPods model, it could have a negative effect on Apple's sales.

If AirPods 2 will go to end-of-life after AirPods 3's mass production, we estimate AirPods 3, AirPods Pro, AirPods 2, and AirPods Max will account for about 40%, 28%, 31%, and 1% of total shipments, respectively, in 2021. If AirPods 2 will continue production after mass production of AirPods 3, we estimate AirPods 3, AirPods Pro, AirPods 2, and AirPods Max will account for about 32%, 28%, 39%, and 1% of total shipments in 2021, respectively.

Kuo attributes the decline in AirPods shipments to increased competition and a loss of market share. There are a number of lower-priced true wireless earbud options on the market for Apple to contend with.

The competitive advantage of Apple's products lies in providing integration of the "hardware, software, and service" ecosystem, not just hardware. The iPhone, for example, has seen its market share decline due to the rapid growth of the smartphone market, but it has been able to maintain shipment growth because of the strong ecosystem of the App Store and developers. We believe that Siri is the core of AirPods' software and service ecosystem, but since Siri's competitive advantage is not significant, the gap between AirPods' leading edge and its competitors' shrinks due to a lack of protection from the ecosystem as competitors gradually improve their user experience and launch lower-price strategies at the same time. We believe that HomePod and HomePod mini shipments were significantly lower than expected for the same reason.

AirPods have quick pairing and fast switching capabilities that give them an edge over competitors, but Kuo says that these advantages are "gradually offset" by improved user experiences and lower prices offered by competitors.

In terms of high quality, while AirPods Pro's low latency is about 50% improvement vs. AirPods 1 and 20% improvement vs. AirPods 2, and it offers active noise cancellation, sales results show that consumers are not very willing to spend more than US$100 to buy the selling points of AirPods Pro.

Kuo says that if Apple wants to improve AirPods shipments in the future, hardware innovation like health management functionality is necessary to differentiate the earbuds from similar products offered by competitors.

Related Roundup: AirPods 3
Buyer's Guide: AirPods (Buy Now)
Related Forum: AirPods

Top Rated Comments

il_teo77 Avatar
11 months ago
Apple should stop stuffing so many releases together at the end of the year. iPad, iMac, MacBook Pro and the like could be released at any time. They mostly are not Christmas gifts but rather tools for professionals as well.
Score: 22 Votes (Like | Disagree)
RamalTheCamel Avatar
11 months ago
For all the hype about these 3rd Gen AirPods from all of these leakers I expected these to come out at least in a 3 month window :/
Score: 9 Votes (Like | Disagree)
thomas040 Avatar
11 months ago
Who else think they are gonna come with health features, such as 'in ear body temperature meter' ? Basically the AirPods could tell you about a fever before you'd feel symptoms.
Score: 8 Votes (Like | Disagree)
SWAON Avatar
11 months ago
I'm more interested about AirPods Pro next gen, what they will bring...
Score: 5 Votes (Like | Disagree)
GizmoDVD Avatar
11 months ago

Apple should stop stuffing so many releases together at the end of the year. iPad, iMac, MacBook Pro and the like could be released at any time. They mostly are not Christmas gifts but rather tools for professionals as well.
I’m sure Apple knows exactly when the best time to release products is. They are experts.
Score: 5 Votes (Like | Disagree)
bobmans Avatar
11 months ago

Who else think they are gonna come with health features, such as 'in ear body temperature meter' ? Basically the AirPods could tell you about a fever before you'd feel symptoms.
Probably reserved for a future iteration of the airpods pro. Doubt they would introduce features like that in the regular airpods, but I assume something like that is definitely going to happen within the next few years.
Score: 5 Votes (Like | Disagree)

Related Stories

5 1

AirPods Pro Shipments Likely to Equal AirPods 2 Shipments By End of 2020

Wednesday September 2, 2020 4:45 am PDT by
Shipments of Apple's higher-end AirPods Pro wireless earbuds are expected to equal those of its second-generation AirPods by the end of the year, according to industry sources (via DigiTimes). Pictured: AirPods 2 (left) and AirPods Pro Apple's shipments for AirPods Pro have been growing steadily since its launch in October 2019, likely to equal those of AirPods 2 by the end of 2020, an...
airpods heath features

AirPods Could Get Health Tracking Features to Beat Competitors

Monday May 17, 2021 3:04 am PDT by
Apple may add health tracking features to AirPods in an effort to combat rival wireless earbuds from companies like Samsung, according to reliable analyst Ming-Chi Kuo. In a recent note to investors, seen by MacRumors, Kuo explained that Apple's sales of AirPods are expected to decline substantially this year, which will likely prompt the company to explore adding new, innovative features to ...
airpodsprodesign

Apple Updates AirPods Pro and AirPods 2 Firmware to Version 3E751

Wednesday April 28, 2021 10:44 am PDT by
Apple today released a new 3E751 firmware update for the second-generation AirPods and the AirPods Pro, updating them from the prior 3A283 firmware that was released back in September. Apple does not offer information on what's included in refreshed firmware, so we don't know what improvements or bug fixes the new firmware brings. There's no standard way to upgrade the AirPods‌...
airpods 3 1

Is This What the New AirPods Will Look Like?

Friday April 16, 2021 4:24 am PDT by
Amid continuing signs that third-generation AirPods are in the works, a number of images of the new design have purportedly leaked online. Images recently shared by 52audio claim to reveal the updated design of the third-generation AirPods, perhaps giving us the first clear look at Apple's next-generation wireless earbuds. The images depict AirPods with a shorter stem and a design very...
airpods max blue

Gurman: Apple Not Working on Second-Generation AirPods Max, But Has Considered New Colors

Friday May 28, 2021 6:11 am PDT by
In a report focused on upcoming third-generation AirPods and second-generation AirPods Pro, Bloomberg's Mark Gurman added that Apple has yet to start working on second-generation AirPods Max, although he said the company has discussed launching additional color variations for the over-ear headphones in the future. The relevant bit from the report:The last AirPods-related hardware...
AirPods3

Gurman: AirPods Pro 2 With Fitness Tracking Coming in 2022, AirPods 3 With 'Pro' Design to Launch Later This Year

Friday May 28, 2021 4:29 am PDT by
Apple is preparing to launch third-generation AirPods this year, and plans to release second-generation AirPods Pro next year, according to Bloomberg's Mark Gurman. In line with previous leaks and rumors, Gurman explained that Apple is readying third-generation AirPods for launch later this year. The updated earbuds will apparently come with a new case and feature shorter stems, broadly...
new airpods leaked image 52audios

Alleged Leaked Image Claims to Show Third-Generation AirPods and Case

Sunday February 21, 2021 2:49 am PST by
A new image claims to offer our first real world look at Apple's next-generation AirPods. The image, shared by 52audio, showcases both AirPods and the charging case for what the site claims to be the third iteration of the wireless earbuds. 52audio has in the past shared images claiming to showcase different parts of the third-generation AirPods. Most notably, the site in November shared...
AirPods Gen 3 Feature

AirPods 3 to Gain AirPods Pro Features

Wednesday January 20, 2021 4:35 am PST by
Apple's upcoming third-generation AirPods are expected to feature a selection of "pro" features, including a new design with shorter stems, pressure-sensitive controls, and improved battery life. Analyst Ming-Chi Kuo has said that third-generation AirPods will have a design "similar to AirPods Pro." Introduced in November 2019, the AirPods Pro feature an in-ear design with soft silicone...

Popular Stories

iPhone 14 Mock pill and hole thumb

ProMotion Now Expected to Remain Exclusive to iPhone 14 Pro Models, Not Expand to Entire Lineup

Sunday January 16, 2022 8:56 am PST by
Continuing the tradition set with the iPhone 13 Pro, only the highest-end iPhone 14 models will feature Apple's ProMotion display technology, according to a respected display analyst. Ross Young, who on multiple occasions has detailed accurate information about Apple's future products, said in a tweet that ProMotion will not be expanded to the entire iPhone 14 lineup and will remain...
safari icon blue banner

Safari Bug Allows Websites to Track Your Recent Browsing Activity in Real Time [Updated]

Sunday January 16, 2022 3:37 pm PST by
A bug in WebKit's implementation of a JavaScript API called IndexedDB can reveal your recent browsing history and even your identity, according to a blog post shared on Friday by browser fingerprinting service FingerprintJS. In a nutshell, the bug allows any website that uses IndexedDB to access the names of IndexedDB databases generated by other websites during a user's browsing session....
ipad air 4 video

New iPad Air Rumored to Launch This Spring With A15 Chip, 5G, Center Stage Camera, and More

Saturday January 15, 2022 8:05 pm PST by
Apple is planning to release a fifth-generation iPad Air with similar features as the sixth-generation iPad mini, including an A15 Bionic chip, 12-megapixel Ultra Wide front camera with Center Stage support, 5G for cellular models, and Quad-LED True Tone flash, according to Japanese blog Mac Otakara. Citing reliables sources in China, the report claims that the new iPad Air could be...
Unlikely Products 2022 Feature

Six Rumored Apple Products You're Unlikely to See This Year

Saturday January 15, 2022 2:06 pm PST by
Much has been said about what consumers could see from Apple in 2022, but the company is also working on a handful of rumored products that aren't expected to be unveiled for at least another 12 months, and in some cases a lot longer. Of course, that's assuming they get released at all. Apple works on many potential products some of which ultimately never see the light of day. With that in...
AirPods Pro Gen 3 Mock Feature Red

AirPods Pro 2 Could Start a New Accessory Ecosystem

Friday January 14, 2022 2:34 am PST by
Apple's second-generation AirPods Pro could arrive alongside a new series of accessories, recent leaked images suggest. Alleged leaked photos of the next-generation AirPods Pro obtained by MacRumors showed a charging case with a metal loop on the side for attaching a strap. Apple has not used this design for any of its other AirPod models and it is unclear why it would be added in this...
netflix2

Netflix Again Raises Prices for All Plans, 4K Streaming Now $20 Per Month

Friday January 14, 2022 12:46 pm PST by
Netflix today updated the prices for its streaming plans, and all of its offerings are now more expensive. The Basic plan is now priced at $9.99 per month, the Standard plan is priced at $15.49 per month, and the Premium plan is priced at $19.99 per month. The Basic plan is $1 more expensive, up from $8.99 per month. This plan allows users to watch on just one screen at a time, and it limits ...
tesla carplay solution

Developer Showcases Apple CarPlay Workaround for Teslas

Monday January 17, 2022 7:24 am PST by
A Tesla Model 3 owner has resorted to a workaround to implement Apple CarPlay in his vehicle, amid no sign of official support from Tesla (via Tesla North). Apple CarPlay and Apple Music support are among the most-requested Tesla features, but with no indication that Tesla is willing to implement Apple CarPlay in its vehicles, Polish developer Michał Gapiński took matters into his own...
top stories 20220115

Top Stories: iPhone 14 Pro Rumors, iCloud Private Relay Controversy, iOS 15.2.1 Released, and More

Saturday January 15, 2022 6:00 am PST by
Hole-punch? Pill? Hole-punch and pill? Rumors about what the front camera system on the iPhone 14 Pro will look like are evolving rapidly, and it now appears we might be getting a novel but potentially controversial design later this year. Other major stories this week included some confusion and controversy about iCloud Private Relay being disabled for some T-Mobile customers, increasing...