Apple Teases Metaverse Plans, CEO Tim Cook Plans Expansion of AR Apps

Cook said that Apple's research and development efforts are focussed on the intersection of hardware, software, and services.

By Reuters | Updated: 28 January 2022 10:14 IST

Apple Teases Metaverse Plans, CEO Tim Cook Plans Expansion of AR Apps

Apple plans to introduce an AR headset by this or next year with glasses to follow later

Highlights

Metaverse-related services could flip Apple's revenue mix
An AR device could open many opportunities to grow subscriptions
Cook's comments on Thursday helped drive Apple stock up nearly 5 percent

Apple teased its metaverse ambitions on Thursday as CEO Tim Cook talked expansion of the company's augmented reality apps, prompting strong investor response.

The company has 14,000 AR apps on its App Store, and Cook suggested this number will rise with further investment.

"We see a lot of potential in this space and are investing accordingly," said Cook, in response to a question about its plans for the metaverse, a broad term that generally refers to shared virtual world environments that people can access via the internet.

[Sponsored] Samsung Galaxy S24: The Ultimate Camera Phone With Smarter On-Device AI

Apple analyst Ming-Chi Kuo and Bloomberg have reported Apple plans to introduce an AR headset by this or next year with glasses to follow later. Apple has not yet publicly acknowledged these plans.

Cook's comments on Thursday, and quarterly profit and sales topping estimates, helped drive Apple stock up nearly 5 percent in after-hours trade.

Apple's services revenue jumped by 24 percent to $19.5 billion (roughly Rs. 1,46,455 crore) in the just-ended holiday quarter, topping analysts' estimates of $18.6 billion (roughly Rs. 1,39,695 crore). The company added 785 million subscribers to its handful of paid services such as for streaming music and playing games, an increase from 620 million a year ago and 745 million last quarter.

Apple Fined EUR 5 Million by Dutch Watchdog Over App Store Payment

Cook separately on Thursday said that Apple's research and development efforts are focused on the intersection of hardware, software and services.

"That's where the magic really happens," Cook said. "There's quite a bit of investment going into things that are not on the market at this point."

An AR device could open many opportunities to grow subscriptions. Existing offerings for fitness workouts and video content could grow more attractive through immersive AR experiences.

And as the services and subscribers have grown, Apple's gross profit margins have jumped above 40 percent, drawing praise from analysts.

Metaverse-related services, such as AR apps, could flip Apple's revenue mix, said analyst Neil Shah of Counterpoint Research.

"There is a significant upside to Apple's services business potentially crossing its iPhone in the next five years," Shah said.

Looking to buy headphones? Listen to the experts on Orbital, the Gadgets 360 podcast. Orbital is available on Spotify, Gaana, JioSaavn, Google Podcasts, Apple Podcasts, Amazon Music and wherever you get your podcasts.

Affiliate links may be automatically generated - see our ethics statement for details.

Comments

For the latest tech news and reviews, follow Gadgets 360 on X, Facebook, WhatsApp, Threads and Google News. For the latest videos on gadgets and tech, subscribe to our YouTube channel. If you want to know everything about top influencers, follow our in-house Who'sThat360 on Instagram and YouTube.