Apple AirPods Help Earbuds Chinese Manufacturer
Apple AirPods Help Earbuds Chinese Manufacturer according to Apple AirPods which also Help Earbuds’ Luxshare Precision Industry Co.
Each has more than tripled this year, outperforming virtually every major stock traded in the Asia Pacific and underscoring the importance of a certain Apple product the Chinese company assembles
AirPods. Commanding a 50% share of the nascent true wireless earphones market — defined by earbuds that have no wired connection between each other or to the music source
Apple’s AirPods have quickly become an important growth driver for the Cupertino, California company.
Wearables are Apple’s fastest-growing category, up 41% in 2019, and are filling in for the iPhone as the company’s growth driver for hardware sales, Bloomberg Intelligence analyst John Butler said.
In 2019, AirPods are expected to double to 60 million, rising to 90 million in 2020 and 120 million in 2021, according to Credit Suisse analyst Kyna Wong.
Luxshare stands to be the biggest beneficiary of that increase in production demand Apple AirPods Help Earbuds Chinese Manufacturer
It’s the fifth-best performer this year in the MSCI Asia Pacific Index and the fourth biggest gainer on the MSCI China Index.
Rival GoerTek has also surged, climbing more than 180% this year on optimism over stronger demand for AirPods.
“Annual shipments of AirPods will rise to as many as the iPhone’s in the future,” said Jeff Pu, analyst at GF Securities.
“AirPods are expected to be the biggest earnings growth driver among Apple’s hardware devices in the coming years.”
Luxshare typically produces basic tech accessories and components, such as cables, chargers and antennas.
The AirPods stand out as a higher-value item, which contributed 26% of Luxshare’s revenue in 2018, according to HSBC analyst Frank
He forecasts that share to grow to as high as 50% in 2020. He also notes that Luxshare is the sole supplier of Apple’s upgraded AirPods Promodel, launched in October, which he estimates will make up as much as 25% of apple AirPods help earbuds’ shipments next year.
Luxshare has grabbed the largest slice of the pie so far, rivals like GoerTek are continually upgrading and vying for more of the lucrative AirPods business.
The company’s exclusivity as sole AirPods Pro supplier is unlikely to last, and so it’s not guaranteed to capture all of the demand growth that’s expected.
Luxshare’s unprecedented rally also means it’s now trading at a two-year blended forward price-earnings ratio of about 32, well above the roughly 24 sector average.
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