Consumer technology companies seem to be running into a flurry of manufacturing troubles that will affect their sales this quarter. Apple Inc. (NASDAQ:AAPL) was one of those, with its AirPods wireless Bluetooth headphones being repeatedly delayed. Now, signs are pointing toward another new Apple product facing an extended release delay: the BeatsX Bluetooth earbuds.
Are we entering into an age where gadgets are pushing the boundaries of manufacturing capabilities, or are consumer tech companies like Apple simply announcing new gear too soon?
BeatsX Delay: Missing Holiday Season Would Be a Tough Blow
When Apple infamously confirmed that it was killing the headphone jack with the iPhone 7, it also announced a collection of advanced Bluetooth headphones. The new products — which would be powered by an advanced Apple W1 chip — were touted as offering a far superior experience to traditional Bluetooth headphones. These new headphones were intended to take the sting out of the headphone jack move.
In particular, Apple was showing off AirPods, which were truly wireless Bluetooth earbuds.
The problem is, the AirPods have been delayed repeatedly and still haven’t seen the light of day.
In what looks to be the latest blow to Apple’s headphone efforts, MacRumors is reporting that BeatsX headphones — also announced with the iPhone 7 — will miss their release date. The website says Mac retailer B&H Photo Video shared an e-mail from AAPL stating BeatsX headphones will be delayed.
“We regret to inform you that the manufacturer has informed us that they still do not know when they will begin shipping this item but they do know that it will take at least 2-3 months.”
The BeatsX headphones — another pair of Bluetooth earbuds using Apple’s W1 chip — have been listed by AAPL as “coming this fall” on its website. It’s possible that despite the e-mail to B&H, Apple itself will get BeatsX stock, but that scenario is unlikely.
And while Apple is still offering several new Beats wireless headphones choices now, the delay to the AirPods and BeatsX mean going into the Christmas shopping season missing two key products that were announced way back at the start of September.
Do AAPL and Other Consumer Tech Companies Have a Manufacturing Problem?
Apple’s problems with the AirPods and BeatsX are just the latest high-profile delays among consumer electronics companies.
GoPro Inc (NASDAQ:GPRO) is looking at a miserable holiday quarter after manufacturing challenges led to limited quantities of its new Karma Drone and Hero5 action camera. The few Karmas that made it into consumer hands were recalled. Fitbit Inc (NYSE:FIT) is also going into the holiday sales season while experiencing production issues that have led to a shortage of its new Flex 2 fitness band.
This spate of production issues for high-profile products from major companies during critical sales windows raises several questions.
Have we reached the point where gadgets have become so complex that they are pushing the limits of manufacturing capability? Are tech companies being too aggressive in pre-announcing products that are nowhere near the delivery stage?
Or is there too great a reliance on supply chains? One small company responsible for a single component (that they were the lowest bidder on) can experience difficulties that negatively impact a product through delays or performance issues.
My money is on a combination of the second and third being at the heart of issues like AAPL is experiencing with the BeatsX delay. Had Apple not pre-announced the new headphones with an expected availability window (as vague as “fall” is) before they were actually production-ready, no-one would even realize there had been any sort of delay. Assembling headphones –even ultra compact wireless earbuds — isn’t rocket science.
But getting all the components that were supplied by different companies working perfectly together can be considerably more difficult.
The price AAPL is paying for the EarPods and now BeatsX delay is twofold. The company takes a hit to its reputation. And it will undoubtedly lose out on some sales. Many owners of iPhone 7s will receive Bluetooth headphones for Christmas, but they won’t be EarPods or BeatsX.
As of this writing, Brad Moon did not hold a position in any of the aforementioned securities.
