Apple (AAPL) may be dealing with lower iPhone demand right now but 2022 could be the year it announces a new product category such as augmented reality glasses or even an electric car. A big product introduction could be a catalyst for Apple stock to move higher.
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Still, those “next big thing” products have been rumored for years, leading observers to take a wait-and-see approach when it comes to their possible introduction.
Apple stock analyst Ming-Chi Kuo of TF International Securities predicted in a Nov. 25 note to clients that Apple will launch AR glasses in late 2022. Augmented reality glasses overlay digital images and information into a wearer’s field of vision. Applications for AR technology include navigation, education, games, commerce and more.
The Apple headset will have a processor with the same computing power as a Mac or PC, Kuo said. He also said the glasses will be able to operate without relying on an iPhone.
AR Glasses On Tap For WWDC?
Apple stock analyst Gene Munster, managing partner with Loup Ventures, believes Apple will introduce its headset in June at the company’s Worldwide Developers Conference, known as WWDC. But the product likely won’t be available for purchase until late 2022 or possibly 2023, he said.
“Apple normally waits until someone has been in the market for a couple of years before they enter,” Munster told Investor’s Business Daily. “But in this case, the stakes around developers and the metaverse and how it comes together are too high to wait.”
Wedbush Securities analyst Daniel Ives said Apple could miss its window of opportunity in augmented reality if lets Facebook parent Meta Platforms (FB), Microsoft (MSFT) and others grab an early lead.
“This really starts the battle for the metaverse,” he told IBD. The metaverse is a next-generation version of the internet.
Ives rates Apple stock as outperform with a price target of 185.
Apple Stock News: Apple Car Developments
Meanwhile, Apple’s rumored self-driving electric car venture has been stuck in the garage as several startups have gone public at high valuations. Those startups include Rivian Automotive (RIVN) and Lucid Group (LCID), which look to compete with market leader Tesla (TSLA).
News related to the Apple car venture in 2021 has mostly focused on leadership turnover in the project.
In June, Apple hired Ulrich Kranz, a former BMW (BMWYY) executive to work on its car project. Kranz also was chief executive and co-founder of electric-vehicle startup Canoo (GOEV). In July, Kevin Lynch, Apple vice president of technology, reportedly transferred to the Apple car venture from the Apple Watch unit.
However, in a setback, Ford Motor (F) hired away the head of the Apple car project, Doug Field, in early September.
Other news about the Apple car project has revolved around possible manufacturing partners and suppliers. Apple reportedly wants to start producing cars in 2025.
Faster Processor Seen For iPhone 14
Meanwhile, the bulk of Apple’s attention in the year ahead will be on maintaining momentum in its core businesses, led by the iPhone.
Apple will look to build on the strong sales of its 5G iPhones with its iPhone 14 series, due out in fall 2022. On Thursday, however, Bloomberg reported that Apple has told suppliers that iPhone demand has slowed as the holidays near. Consumers are dealing with inflation and renewed Covid threats, the report said, as Apple shares fell on the news.
Still, current speculation on the iPhone 14 is that it will look like the previous two generations but sport improved components.
For instance, the iPhone 14 could use 3-nanometer or 4-nanometer scale processors supplied by Taiwan Semiconductor Manufacturing (TSM). The current iPhone 13 uses 5-nanometer scale processors. Circuit widths on chips are measured in nanometers, which are one-billionth of a meter. Smaller-scale chips translate to faster processors with greater power efficiency.
The big story with Apple’s Mac computers in 2022 will be the completion of the company’s two-year transition from Intel (INTC) processors to Apple-designed chips made by Taiwan Semiconductor.
As of now, only three Macs that Apple currently sells still use Intel chips. They are the 2020 27-inch iMac, the 2019 Mac Pro, and the 2018 Mac Mini.
App Store Issues Contained Risk For Apple Stock
Another continuing story that’s hanging over Apple stock is more potential legal and regulatory troubles. These issues mostly target the company’s services business and the App Store in particular.
Critics have accused Apple of anticompetitive behavior with its App Store policies. Analysts say Apple could be forced to take third-party payments and allow direct communications between app developers and their customers.
Wall Street sees regulatory and legal issues related to the App Store as a “contained risk,” Ives said.
Research firm CCS Insight made several bold predictions for Apple in its annual year-ahead predictions. The firm believes Apple will launch its own social network by 2023 to take on Facebook and others. Apple will provide a content-rich experience with strong privacy controls, CCS said.
Similarly, CCS also thinks Apple will launch a privacy-focused search engine for its users by 2023. Alphabet‘s (GOOGL) Google currently pays Apple to use its advertising-based search services on Apple devices.
On Nov. 17, Apple stock broke out of a cup-with-handle base at a buy point of 153.26, according to IBD MarketSmith charts. Apple stock notched a record high of 165.70 on Nov. 22.
Follow Patrick Seitz on Twitter at @IBD_PSeitz for more stories on consumer technology, software and semiconductor stocks.
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