Apple's HomePod isn't selling - stocks are piling up

Yolanda Curtis
April 12, 2018

Initial sales of Apple's HomePod have underperformed the company's conservative forecasts, leading the company to cut manufacturing orders and lower forecasts, Bloomberg reports.

Apple has lowered its forecasts for the HomePod and cut orders for the smart speaker due to lackluster sales, reports Bloomberg. The main issue seems to be that consumers assumed that the HomePod would retain the same functionality as competing speakers like the Google Home or Amazon Echo. In the first 10 weeks of sales, HomePod accounted for about 10 percent of the smart speaker market in contrast to Amazon's 73 percent share.

While reviews of HomePod's audio quality varied from positive to middling given its high price point, there was near-universal agreement that the speaker's software side was troubled.

Apple has unveiled the $349 HomePod at WWDC during the last June and calls the device a "breakthrough home speaker" which grant permission to Siri Virtual Assistant in user's homes. At Apple Stores throughout the country, the HomePod is collecting dust with some locations selling fewer than 10 units a day.

It's still too early to label the HomePod a total flop. Apple declined to comment. The product was supposed to be released in December just in time for the holidays, but Apple missed the release and delayed the product. Of course, if HomePod sales remain lukewarm with a more wallet-friendly option available, it will become abundantly clear that the key to success in the smart speaker market isn't a top of the line acoustic experience, but rather, a top of the line intelligent assistant. Loup Ventures analyst Gene Munster expects sales of 7 million units this year and 11 million next year; although, that's significantly less than his expectations for Amazon and Google. Some HomePod buyers also complained that the device leaves marks on wood, a situation Apple is now working to rectify with a new material, according to people familiar with the work. Alphabet is expected to sell 18 million Google Home devices this year and 32 million next year.

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