Apple is stirring up the rumor mill with whispers of a new product category poised to debut later this year.
While the spotlight has been on their self-driving car, a venture likely still a few years down the road, another innovation is primed for release.
This new offering is anticipated to be an Apple VR/AR (Virtual Reality/Augmented Reality) Headset. The timing couldn’t be better, with the recent surge in interest around the Metaverse concept. Although Apple hasn’t officially confirmed the development of VR glasses, multiple reports suggest that approximately 1,000 engineers are currently engrossed in crafting this new addition to Apple’s lineup.
Currently, the Oculus Quest headset from Meta reigns as one of the most sought-after options on the market. The question now becomes whether Apple can deliver an innovation that can truly steal the show. After all, when the iPhone was first launched, Apple transformed the mobile phone market. Before the iPhone’s debut, mobile phones featured small screens and physical buttons. Apple upended the status quo by introducing a device with a sizable touch screen and the App Store, essentially laying the foundation for today’s smartphone market.
Apple VR/AR headset
Yet, it’s important to note that Apple’s VR and AR headset remains within the realm of rumors. Renowned Apple observer Ming-Chi Kuo predicts that the headset will come equipped with an advanced detection system, enabling control through hand movements. Apple intends to employ various 3D sensors for this feature, one of which is already present in the iPhone. This technology would enable users to create Animojis, where the device tracks facial expressions and mirrors them onto an animated emoji of their face.
The Apple VR/AR headset, if the rumors hold true, would be a high-end product featuring separate high-resolution displays for each eye. While it’s rumored to start at a base price of $1,000, this is more than double the cost of an Oculus Quest 2, which starts at $400.
Experts speculate that Apple might not unveil this product until mid-year, with sales commencing towards the year’s end. Consequently, Apple might only begin recognizing additional revenue from this new product category starting in 2023.
Buy or hold?
Analysts underline Apple’s position as a blue-chip stock suitable for any tech investor’s portfolio. With a foray into headsets, Apple could potentially establish itself as a prominent player in the rapidly expanding Metaverse. However, because these developments are still speculative, they are not yet factored into the price targets.
Most analysts issue a buy recommendation for Apple stock. Morgan Stanley, Citigroup, and Wedbush set a price target of $200, approximately 10% above the current price of $180. In contrast, Goldman Sachs and Credit Suisse adopt a more cautious stance with hold recommendations, attaching price targets of $142 and $150, respectively, indicating the possibility of a future decline.
