Headlines are circulating claiming Apple cut Vision Pro production by almost 50% due to weak demand. Here’s why they’re almost certainly false.
The source of these articles is a new note from supply-chain analyst Ming-Chi Kuo. Kuo’s claims sometimes turn out to be true, but not always, and his latest contradicts not only what we know about Vision Pro production, but what Kuo himself said just a few months ago.
Specifically, Kuo is claiming that Apple reduced its sales forecast for Vision Pro from a “market consensus” of 700-750K units to 400-450K units, a roughly 40% reduction.
There are two reasons this claim doesn’t make sense.
Firstly, Kuo claims the decision is due to weaker than expected US demand, leading to a production cut ahead of global launch. Yet as recently as February Kuo said Apple’s US target for 2024 was 150-200K units, and in January he said Apple sold almost 200K preorders. MacRumors separately cited “a source with knowledge of Apple’s sales numbers” as saying Apple had sold 200K preorders, particularly ironic given it’s now presenting Kuo’s claim and as if it were official news.
But more importantly, in January Kuo was referencing Apple Vision Pro “achieving a shipment volume of 500,000 units” as the goal for 2024. And this isn’t just a random number – it’s what multiple sources report is Apple’s supply limit for the year, regardless of demand.
The Financial Times, The Information, and The Elec have previously reported that Vision Pro production is heavily constrained by the extremely limited supply of near-4K OLED microdisplays. All three sources reported that Sony, the supplier, can only produce enough microdisplays for less than 500K headsets in 2024. And Kuo himself agreed with this figure, saying in a September note that Vision Pro production in 2024 will be limited to “at most 400,000–600,000 units”.
Given this, why is Kuo suddenly claiming the “market consensus” was 700-750K units? It simply doesn’t make sense.
David Heaney
With a $3500 entry price Apple Vision Pro was never going to be a breakout mass market hit. The product’s very name suggests it’s just the beginning of the Vision headset line, and multiple sources have reported that Apple plans a much more affordable model later in the decade. But Vision Pro’s price is dictated by its production and supply constraints, and it’s those constraints limiting its volume, not lower than expected demand.
Don’t believe everything you read.
David Heaney
