Apple has another big hit on its hands with its AirTag location beacon, and eager customers are buying in large volume, according to independent research from market analysts. Apple almost always has that golden touch, combining high-quality products with striking design aesthetic, and building upon its brand image for reliability and user-friendliness. The AirTag and its accessories were always expected to sell well, but might be playing an even more significant role in Apple's portfolio than expected.
Apple launched the AirTag in April of 2021 as a new kind of item tracking tag that uses advanced technology to provide much greater precision than older Bluetooth beacons, such as those made by Tile. The ultra-wideband (UWB) signals that set the AirTag apart from most other trackers provides both a heading and a range on the screen of a compatible iPhone, resulting in locating lost items with remarkable speed when they are nearby. Samsung has a similar product, the Galaxy SmartTag Plus, which also has UWB capability, but can't compete with Apple's billion-strong Find My network that anonymously helps track lost items almost anywhere in the world. The combination of a massive network for locating items on a map and UWB precision finding might make the AirTag unbeatable in the short term.
According to a recent report by Barrons, both Citigroup and JP Morgan analysts place Apple stock targets at $170, with Citigroup analyst Jim Suva pointing to strong demand for almost every Apple product and citing independent research on the AirTag and accessories. Apparently, many iPhone users are purchasing the four-pack of Apple's AirTag over the single unit. Considering that the iPhone is the most popular smartphone in the United States, accounting for over 100-million devices, this is a significant win for the tech giant. Naturally, accessories are ordered as well, since an AirTag by itself can only be used to track items that have a pocket or someplace to store it. In order to find lost keys, a keyring that can hold an AirTag is needed.
How Good Are AirTag Sales?
The report didn't share sales figures and Apple's financial report which might give a better idea of AirTag sales isn't due until later this month. However, the stock target of $170 indicates the strength expected by some analysts. The current stock price is around $150-per-share. Several polls have suggested that the number of iPhone owners interested in buying one of more AirTag trackers reaches 60-percent or more, which might place the number of AirTag sales in the 60-million range and four-packs potentially raising that to over 100-million for Apple's location beacons.
Apple gave a price incentive for shoppers to buy an AirTag 4-pack, which sells for $99, compared to $29 when bought individually. This influx of cash is even greater when the accessories are considered, since Apple has a higher margin on key rings and loops, being priced as fashion accessories. Some customers may be spending significantly more on AirTag accessories than on the trackers themselves. An extreme example is the AirTag Hermès Luggage Tag, which is priced at $449. Most will pass on this option but even the lower-cost leather loops and key rings are more expensive than the AirTag itself. Apple manufactures outstanding devices and also promotes them better than many other tech companies. In this case, it would seem that iPhone owners don't just want the AirTag, they can't get enough of them.
Source: Barrons