Transcription
The Vision Pro is over, but it's even worse than anyone realizes. In 2024, around 390,000 Vision Pros were sold. The following year, sales figures in the Christmas quarter, one of the strongest revenue periods of the year, reached just 45,000, and the overall sales figures are even more depressing. Apple has cut its marketing budget by more than 95%, stopped production, and canceled the latest version. Despite the high price, Apple loses money on every Vision Pro. Why did this thing fail so miserably, and what is Apple doing now? This could be Apple's biggest disaster ever. The Vision Pro should have worked. It met all the criteria of Apple's foolproof, proven strategy, except for one. So, what was that? To find out, we need to look at Apple's strategy. The iPod, iPhone, iPad, and Apple Watch followed a similar three-stage strategy: enter late, refine thoroughly, and dominate the market. But with Vision Pro, this failed because a crucial detail was missing. When the iPhone launched, it was offered in two price categories: $499 for the 4GB model and $599 for the 8GB model. Compared to the Blackberry Storm, which cost $199, and the Nokia 6300 or 5310 Express Music, which typically cost between $150 and $300, the iPhone was far more expensive, but it was the iPhone, and people queued for up to a week to get it. It was similar with the Apple Watch. Prices started at $359 and $549. While there was also a $10,000 version, Apple removed it from the lineup the following year. The iPad cost $499 in 2010. Apple products are not really new innovations. They only enter the game when competitors are everywhere, and they are more expensive. They tend to develop existing things further rather than inventing something new. But if you want a new technology to become mainstream, wouldn't you make it as affordable as possible, and wouldn't that help the Vision Pro? Many other companies do this, often accepting losses to achieve the highest possible market penetration at lower costs and, in the case of technology, to gain developer support. That's why the Meta Quest is so cheap, but more on that later. Of course, with such products, data protection and privacy are always a very big issue, but you don't need AR glasses for big tech companies to spy on you and secretly collect all sorts of data about you, because they do that anyway, all the time. But it doesn't have to be that way, because you can protect yourself by simply not using their services. Infomaniak is a leading European cloud company and a real alternative to Google and others. Infomaniak offers a variety of services, including the lifetime free My KSuite. A solution that does not analyze data, is ad-free, and is developed and hosted entirely in the heart of Europe. With the free My KSuite, you get an email address, 15 gigabytes of cloud storage for your photos and documents, including modern office tools, a video chat solution, and so on. And unlike the big tech giants, Infomaniak is based in Switzerland and sees it as its mission to contribute to Europe's technological independence with ethical cloud solutions, without any compromise on privacy. All data is stored according to the highest security and privacy standards in Infomaniak's own data centers in Switzerland and is never analyzed or used for commercial purposes. These data centers have also been designed with a focus on sustainability and use only filtered outside air for cooling, not air conditioners or water. Nearly 100% of the electricity consumed comes from renewable energy sources, and the heat generated is used to heat 6,000 households. There is also a special offer for you if you want to upgrade to the paid My Case Suite Plus, where you can get 1 or 6 terabytes of cloud storage and advanced features. With the code "einfach50", you get a full 50% discount on your first 12 months. Thank you to Infomaniak, and let's continue with the video. Apple often takes a completely different approach, and for a very important reason. Apple starts high, targeting customers willing to pay the most. Luxury customers and die-hard fans. Then, as production becomes cheaper and the technology matures, Apple expands. But it doesn't really get cheaper. They release more versions, more price variations, some slightly cheaper, some more expensive. It moves from the premium segment to a more accessible broader market, but still feels higher quality than the competition. This is precisely where the Vision Pro is a bit strange. It seems to meet all the criteria. It entered the market later, advanced VR with new technology but didn't invent it, was fully integrated into the ecosystem, and ran iPhone and iPad apps, but Apple overlooked a crucial part of its playbook. There was no large VR market. All their successful products entered the market later because they had enormous market validation. There were smartphones before the iPhone and tons of tablets before the iPad. Did they redefine these markets after entering? Absolutely, but the most important thing is that Apple waited until there were clearly customers spending money here. While there were plenty of VR products, the number of customers was extremely low, and even today in 2026, the market is shrinking, declining by 14% compared to the previous year, while Meta's cheaper Quest for $500 dominates about 80% of the market. But there was another small problem that makes the whole thing even stranger. The price. For decades, Apple has been able to charge premium prices because consumers are willing to pay extra for what they perceive as the best version. This time, there was no mass market for Apple to position itself above. The Meta Quest 3 only cost $500, the 2 even only $300, and even the premium Quest Pro model only cost $999. Apple products are normally much more expensive, but not to this extent. So, the Vision Pro had a fatal flaw, but it could still have been a more niche Apple product, like the Pro Display XDR, or? Well, not necessarily. The unit costs for this product are insane. The amount Apple has invested in this thing has made the Vision Pro the worst Apple disaster in decades. To understand how bad the situation really is, let's take a closer look at these sales figures. The launch of the Vision Pro was okay. In 2024, around 390,000 devices were shipped, but by the Christmas season of 2025, one of the strongest revenue quarters of the year, only 45,000 devices. For comparison, the Mac was shipped 7.1 million times in that single quarter. Furthermore, it is still only available in 13 countries. Even in the US, Apple's strongest market, things look bad, and stores are only getting rid of them with discounts. Apple has tried to revive the device with new features, more apps, and even a potentially cheaper version, the Vision Air, but none of it has worked. So, Apple completely stopped production in April. The thing is now: Apple makes expensive products, and some of them struggle, but Apple usually reaches the break-even point or more eventually because they sell huge volumes. However, with the Vision Pro, the fundamental structure is broken, and here's why. When the Vision Pro launched, it was already the most expensive VR headset ever, by threefold. Estimates put the research and development costs at around $20 to $33 billion, which is roughly what Meta has also spent on R&D. For comparison, Apple spent 15 years and around $10 billion on its canceled car project, far less than what the Vision Pro may have cost. This is where this headset starts to look less like a premium product and more like an expensive problem for Apple. But it gets worse. When we look at the variable costs, meaning the cost of each individual Vision Pro. The market research firm Omdia estimated the material costs of the Vision Pro at $1542. This does not include research and development, packaging, and marketing, only the raw materials and components. The most expensive component in the headset is the 1.25-inch display from Sony Semiconductor, which sits directly in front of the user's eye. According to Omdia's estimate, Apple pays about $228 for the micro-OLED displays used. Each Vision Pro requires two of them, one for each eye. Considering this, the selling price makes more sense. At a selling price of $3499, the Vision Pro is sold for about 2.3 times the cost of its parts, resulting in a gross profit margin of about 56 percent. This is quite normal for Apple, but this is only the gross profit. The net profit, including marketing and especially these gigantic R&D costs, makes the situation look much worse. Even assuming the lower estimate, Apple has spent around $20 billion developing the Vision Pro and sold about 600,000 devices. This results in development costs of over $33,000 per headset sold. The selling price of the Vision Pro was $3499. So, combining the material costs and the selling price, Apple has lost an average of $28,000 per Vision Pro. It's probably not exactly like this, but it's definitely in that range. Apple had to set the price high due to its usual policies and high costs, but this high price meant it remained a niche product, and now Apple is basically giving up. They have stopped production at Apple's manufacturing partner Luxshare. They have cut advertising by more than 95 percent. They have stopped work on the new version, the Vision Air. I don't think Apple should have entered the VR market. Some markets can be safely ignored, and it's okay to say no to a new expansion or a new product. But this story has another side. Wearables are selling well, while Apple has spent billions building a heavy computer for your face, the real solution might have been something much simpler all along. A solution that Apple is now chasing. The Meta Quest series hasn't really gotten off the ground. Meta has made many of the same mistakes as Apple, even though they tried to keep prices low and achieve as much developer support and market penetration as possible. But now Meta's wearables are successful. They have targeted the exact same everyday consumer that Apple had in mind by developing something people were already accustomed to. These are the Meta Ray-Bans, launched on September 17, 2025, as part of their partnership with the world's largest eyewear manufacturer. Ironically, Meta uses Apple's strategy. Enter late, iterate, refine thoroughly, focus on premium. Smart glasses and phones existed before. They feature a heads-up display and an integrated AI assistant that captures audio and video data and then processes it either partially directly on the device or forwards it to a paired phone or iCloud. Already in 2025, Meta sold over 7 million Meta AI glasses, after initially expecting only 2 million. Then something interesting happened. On October 1, 2025, Apple stopped production of the Vision Air, the lighter version of the Vision Pro, to focus on accelerating the production of smart glasses with displays. This happened just 14 days after the Meta demo. On April 20, Apple announced that John Turnus would become the company's next CEO, succeeding Tim Cook on September 1, 2026. Why is this important? Because reports show that Turnus was one of the biggest skeptics of the Vision Pro. Turnus has also approved a comprehensive overhaul of Apple's roadmap for headsets and smart glasses, which will now focus on just two smart glasses models. Apparently, Apple is preparing to unveil smart glasses as early as September or October 2026. So, we will likely see something from Apple soon, but something really strange is happening. Meta has unveiled its display glasses, and just two weeks later, Apple has canceled its cheaper Vision Pro successor. Think about that for a moment. For years, Apple was the company that set the direction in consumer technology. Everyone else followed. The iPhone, the iPad, the Apple Watch. But this time, Apple is the imitator. The funny thing is that Apple is doing exactly what Meta did. They bet everything on a revolutionary VR product, spent billions. It was a flop, and now they are switching to smart glasses. So, the problem in Apple's roadmap is fixed. But will Apple now just be chasing Meta? Thanks for watching. Check out one of our other videos now, and if you want more explained simply, feel free to subscribe to the channel.