Recovering Tablet Market Holds Breath for iPad Launch
Possible inclusion of M4 chip is talk of the industry, but why is Apple’s next move so important?
As the recovering tablet market sees promising signs of resilience, all eyes are on the impending iPad launch from Apple to potentially catalyze further growth.
Led by strong results from Android vendors and resurgent Chinese brands in their domestic market, the global tablet market shipments contracted only 3% in Q1 2024 compared to the year-ago quarter. Poor Apple iPad results continue to hold back full market recovery, but we believe pent-up demand for new models will push the tablet market into growth in mid-2024.
In Q1 2024, Apple shipped 11.4 million iPad units globally, representing an 11% year-over-year decline and falling to 35% market share. While Apple’s growth story is moving in the right direction, their lack of new products is hurting demand from their user base and is driving new customers to Android vendors that have improved their premium product mix like Samsung, Lenovo, and Xiaomi.
Figure 1: Most Android vendors outperformed Apple in Q1 2024
On-device AI has become the buzzword for 2024, which is why the rumor of the M4 chip coming to the next generation iPad Pro has grabbed so much attention. Apple has shied away from talking about AI, even though their M-series chips have brought on-device AI capabilities since 2020. While this would steal some of the thunder from AI PC news expected later this month by Microsoft and at Computex by many of the leading OEMs and Qualcomm, there are several reasons why we do not believe Apple will go this far.
First, their WWDC conference in mid-June is expected to be the inaugural party for their AI strategy, detailing the latest OS versions and showing off use cases across multiple computing platforms. We don’t believe they would squander a company-wide AI push for a recorded webcast announcing two new tablet models. Second, development of the M4 chip reportedly began in March 2024, making it highly unlikely that it will be ready to ship so soon. Third, we believe that Apple can already make a credible argument that a new iPad Pro with the M3 chip is one of the most powerful AI tablets on the market. Finally, there are other well-documented delays related to OLED screens, camera modules, and software development that held back the initial launch plans of late March.
If Apple were to get around the development time to release M4 in the iPad Pro, they will have changed the narrative of having one of the stalest tablet product portfolios to having one of the most cutting-edge tablets on the market. We will share our take-aways after Apple’s May 7 announcement, so stay tuned!
