Apple might sell only 2 million HomePod units in 2018 if the new report from KGI is to be believed. Earlier this week it was reported that the company has cut orders for its smart speaker due to lower than expected demand for the HomePods.
Known Apple analyst Ming-Chi Kuo of KGI Securities suggests that Cupertino-based tech giant might only be able to sell between 2 and 2.5 million units this year. Previously, he estimated that HomePod would sell over 7 million units in 2018, with some reports even suggesting a number of 10 million units.
Some analysts even believed that the HomePods would challenge both Amazon's Echo and Google Home line of speakers in term of sales numbers. However, now it appears that the demand for the speaker isn't as high as they expected, with many blaming the $349 price tag as the prime reason for the weak sales numbers.
Due to this, Apple is reportedly planning a stripped down version of the HomePods to gain more customers on a budget, while pushing users towards Apple Music, which is currently the only music service available for the smart speaker.
Although KGi report doesn't confirm the existence of a low-end model since Apple is yet to finalize the decision. Also, Apple HomePods' is only limited to English-speaking markets at the moment.
Apple is also not expected to officially disclose the sales numbers any time soon. But, since the company is said to be planning a low-end variant, it could be a notable hint at how well the HomePod is doing in the market.
To add to Apple's troubles, the company was recently ordered to pay $502.6 million to VirnetX Holding Corp. after the company lost a patent infringement lawsuit. The verdict was announced by the grand jury in Texas after finding that Apple infringed patents that were related to secure communications, reports Bloomberg.
The legal battle between the companies has been going on for past eight years. VirnetX makes most of its money from licensing patented technology that powers virtual private networks over the web. The company filed three lawsuits against Apple back in 2010 alleging that Apple's FaceTime, iMessage, and VPN on Demand are already patented by VirnetX. In February 2016, Apple was ordered to pay $625.6 million in damages after two of the lawsuits were combined, but the verdict was later voided by a federal judge saying that combining two lawsuits would be unfair to Apple.