Apple AAPL is anticipated to launch its much-awaited virtual reality headsets in Q2 2023. Per analyst Ming-Chi Kuothe VR headsets will be launched a bit later than initially expected due to the Shanghai lockdown that interrupts its development.
Many different suppliers are readying themselves to take a significant stake in Apple’s new bet to delve into AR. Apple is expected to use Sony’s SONY MicroOLED display for the first units to be produced, per 9to5Mac.
Apple has been working with Sony for a couple of years to develop the display that will feature high image quality in a small and lightweight design. However, another company vying for this spot is LG Display. LG Display is expected to have ordered deposition equipment to make MicroOLED displays from Sunic System. This will help LG Display manufacture the MicroOLED panel for Apple’s VR headset.
Apple’s mixed reality headset is its the most anticipated product that is expected to help the company diversify its sources of revenues. This is expected to impact Apple’s share price positively in the long haul.
Apple Inc. Price and Consensus
Apple Inc. price-consensus-chart | Apple Inc. Quote
What’s in Store for Apple’s Stock in 2022?
Apple’s revenue-generating abilities have been negatively impacted due to coronavirus-induced supply-chain disruptions, silicon scarcity across industry and the ongoing Russia-Ukraine conflict.
Further, Apple did not provide any revenue guidance for the third quarter of fiscal 2022 due to uncertainty created by the macroeconomic volatility and geopolitical tensions.
Apple expects COVID-induced supply chain disruptions and the industry-wide silicon shortage to hurt top-line growth by $4-$8 billion. Unfavorable forex is also expected to hurt revenues by 300 basis points (bps).
Apple has halted operations in Russia, which is expected to hurt top-line growth. Also, due to the global rising inflation, customers have pulled back on their purchases. This will impact Apple’s shares negatively, as it did to its FAAMG peers — Meta Platforms META and Microsoft (MSFT).
Apple, which currently carries Zacks Rank #3 (Hold), has seen its stock lose 25.7% in the year-to-date period compared with the Zacks Computer – Mini computers industry and Zacks Computer and Technology sectors’ declines of 25.2% and 32.2 %, respectively. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Meta has also seen its stock lose 50.9% in the year-to-date period compared with the Zacks Internet – Software industry’s decline of 53.4%.
Microsoft shares have lost 27.7% in the year-to-date period compared with the Zacks Computer – Software industry’s decline of 29.8%.
However, as Apple forays into the AR space, solid anticipation for the company’s mixed reality headsets and AR glasses is expected to drive the demand for the products. Per Bloomberg, the metaverse market, globally, is expected to reach $800 billion by 2024, which will create an alternate revenue source for Apple, thus impacting shareholders’ wealth creation positively.
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