13:24
The Vision Pro is dead, but it's way worse than everyone realizes. In 2024, the Vision Pro sold around 390 thousand units. The next year, the holiday quarter - one of the biggest of the year - was just 45 thousand. And the lifetime sales… are even more depressing. Now, Apple has cut the marketing budget by more than 95%, halted production, and cancelled the newest version. Despite the high price, every Vision Pro was costing Apple even more money. Why did this thing fail so badly?
And, what is Apple doing now? This might be Apple's biggest disaster, ever. The Vision Pro should have worked. It ticked all the boxes in Apple's foolproof, tried and true strategy. Well… except one. So what was it? To find out, we need to look at Apple's Playbook. The iPod, iPhone, iPad, and Apple Watch followed a similar three-step strategy: enter late, polish hard, and dominate. But this failed with the Vision Pro, which lacked a crucial detail. When the iPhone debuted, it was released at two price points: $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 XpressMusic, which typically cost between $150 and $300, the iPhone was far more expensive. But… it was the iPhone, and people were lining up for as long as a week to get it. The Apple Watch was similar. Starting at $359 and $549. It did have a $10,000 version… which Apple ditched the following year. The iPad was $499 in 2010. Apple products aren't really new. They come into the game when competitors are everywhere, and they come out more expensive.
They more so "iterate" on what exists, rather than invent. But, if you want a new technology to become mainstream, wouldn't you make it as affordable as possible? And wouldn't this help the Vision Pro? Many other companies do this, often taking a loss to get as much market penetration as possible, for lower costs, and in the case of tech: developer support. This is why the Meta Quest is so cheap, but more on that later. Apple… often takes a very different approach, and for a very important reason. Apple starts high, targeting customers
who are willing to pay the most. Luxury customers and diehard fans. Then, as production gets cheaper and the technology matures, Apple expands. But, it doesn't really get cheaper. They make more versions, more price variants, a bit cheaper, but also more expensive. It moves from premium to a more accessible, broader market, but still "feels" more premium than competitors. But, this is where the Vision Pro is a bit weird. It seems to tick all the boxes. It entered late, it iterated on VR with new technology, but didn't invent it. It had full ecosystem integration, running iPhone and iPad apps. But, Apple overlooked one crucial part of their playbook.
There wasn't a big VR market. All their successful products enter late, because they have huge market validation. There were smartphones before the iPhone, and many mobile phones. Heaps of tablets before the iPad. Did they redefine those markets after entering? Absolutely. But, the most important thing is that Apple waited until there were clear customers spending money here. With VR, there were plenty of products, but the number of customers was super niche. And even today, in 2026, the market is shrinking, falling by 14% year-over-year, while Meta's cheaper Quest at $500 controls around 80% of the market. But, there was another small problem, which makes all of this much stranger. That 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 wasn't a mass market for Apple to position this high. The Meta Quest 3, at just $500, with the 2 as low as $300. Even the premium Quest Pro was just $999. Apple products are usually much more expensive, but nothing like this. $3,499. So the Vision Pro had a fatal flaw, though it still could have been a more niche Apple product, right, like the Pro display XDR. Well, not necessarily.
The unit economics of this is crazy. The amount of money Apple poured into this thing has caused the Vision Pro to be the worst Apple disaster in decades. To understand how bad things really are, let's take a closer look at those sales. Vision Pro launched ok, shipping around 390,000 units in 2024. But by the 2025 holiday season? One of the biggest spending quarters of the year? 45,000 units. For context, the Mac shipped 7.1 million in that single quarter. Also, it's still only available in 13 countries. Even in the US, which is Apple's strongest market, it's bad. Stores are discounting it.
Apple has been trying to revive it with new features, more apps, and even a potential cheaper version, the Vision Air. But none of it moved the needle. So in April, Apple halted production altogether. Now here's the thing. Apple makes expensive products. And some of them struggle. But Apple, usually eventually, breaks even, or better, because they sell huge volumes. But with the Vision Pro, the fundamental structure is broken. Here's why. The Real Problem When the Vision Pro launched, it was already the most expensive headset ever, by a factor of three. Estimates put the cost of R&D at about 20-33 billion, which lines up with what Meta spent on R&D too. For comparison, Apple spent fifteen years and
roughly $10 billion on its cancelled car project, far less than what Vision Pro may have cost. And that's 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. The cost of each Vision Pro. Research firm Omdia estimated the Vision Pro's bill of materials at $1,542. That's excluding R&D, packaging, and marketing. Just the raw materials and parts. "The most expensive part in the headset is the 1.25 inch Sony Semiconductor display that goes in front of the user's eye… Apple pays about $228 for the "Micro OLED" displays it uses,
according to the Omdia estimate. Each Vision Pro needs two of them, one for each eye." At $1,500, the selling price begins to make more sense. With a $3,499 retail price, the Vision Pro sells for about 2.3 times the cost of the parts inside it, and puts the gross profit margin at about 56%. That's pretty standard for Apple, but, that's just the gross profit. Net profit, including marketing and most of all that gigantic R&D cost, makes things much worse. Even assuming the lower end, Apple spent around $20 billion developing Vision Pro and sold roughly 600,000 units. That works out to more than $33,000 in development costs for every headset sold. While, Vision Pro retailed for $3,499.
So, including the material cost and the price, Apple lost, on average, $28,000 per Vision Pro. It's probably not exactly that, but… it's definitely around this area. Apple had to price it high because of its usual rulebook, and the high costs. But, that high price meant it stayed a niche product. Now, Apple is basically giving up. They've halted production from Apple's manufacturing partner, Luxshare. They've cut advertising by more than 95%. They halted work on the new version: the Vision Air. I don't think Apple should have gone into VR.
Some markets can be left on the table, and it's okay to say no to a new expansion or new product. But, there's something else to this story. Wearable tech is selling. But while Apple spent billions building a heavy computer for your face, the real solution may have been something far simpler all along. A solution which Apple is now chasing. We're almost at 1 million subscribers, so if you haven't already, please subscribe! Thank you. The Meta Quest line didn't really go anywhere. Meta made a lot of the same mistakes as Apple, though they tried to price low and get as much developer support and market penetration.
But, Meta wearables are succeeding now. They've targeted the same everyday consumer that Apple had in mind by building something they were already used to. These are the Meta Ray-Bans, with their partnership with the world's biggest eyewear maker, released on September 17, 2025. Ironically, Meta is using Apple's strategy. Entering late, iterate, polish hard, go premium. Smart glasses and phones existed before. They have a heads-up display, an integrated AI assistant that captures audio and video,
then either processes parts of that on-device or hands work off to a paired phone or the cloud. In just 2025, Meta sold over 7 million Meta AI glasses after estimating just 2 million. Then something interesting happened. On October 1, 2025, Apple paused the Vision Air production, the lighter version of Vision Pro, to focus on accelerating production on smart glasses with a display. That came just 14 days after that Meta demo. Then on April 20th, Apple announced that John Ternus would become the company's next CEO, taking over from Tim Cook on September 1st, 2026. Why does that matter? Because reports have shown that Ternus was one of the biggest skeptics of the Vision Pro.
Ternus has also approved a major overhaul of Apple's headset and smart glasses roadmap, which will now focus on just two smart glasses. Apparently, Apple is preparing to unveil smart glasses as early as September or October 2026. So, we're likely to see something from Apple soon. But, something really weird is happening. Meta unveiled its display glasses, and just two weeks later, Apple killed its cheaper Vision Pro successor. Think about that for a second. For years, Apple was the company setting the direction of consumer
technology. Everyone else followed. The iPhone, iPad, Apple Watch. But this time, Apple is the follower. The funny part is that Apple is doing exactly what Meta did. They went all in on a revolutionary VR product, spent billions, it flopped, and is now moving to smart glasses. So, the one problem in the "Apple roadmap" is fixed. But will Apple just be chasing Meta now? When the Apple glasses launch, assuming maybe 2027, the Meta Glasses will have a few years head start over Apple. They're already being used by millions of people, and this has caused another big problem that not enough people are talking about.
These AI glasses are a privacy disaster, that's already happening. They're always on, always recording, always listening, and privacy experts are starting to panic. And, unlike smartphones or social media, these glasses make it worse not just for those wearing them, but everyone. Watch this video next to learn more.
