Exciting Developments in Smart Glasses Technology This Year 🔍
The emergence of smart glasses, especially those with components manufactured in China, is capturing attention as we enter the fall consumer tech season. This new category offers a more accessible alternative to Apple’s high-end Vision Pro and the complex technology typically associated with virtual reality headsets. Companies such as Snap have unveiled augmented reality glasses, while Meta is set to showcase its innovations in an event starting on September 25. Notably, Meta’s Ray-Ban Meta Smart Glasses have started gaining traction, as highlighted by Frank He, HSBC’s head of technology hardware research for mainland Chinese stocks, in a recent report.
Increased Demand and Sales Growth 📈
According to the latest research from HSBC, the second generation of smart glasses has achieved remarkable sales figures, exceeding 1 million units sold in the first half of this year. In comparison, the first generation managed to sell just 300,000 units from September 2021 to February 2023. The rising interest in wearables is indicative of a shift toward broader acceptance of such devices among consumers.
Potential for Future Expansion 🚀
Frank He believes that a turning point may be on the horizon, largely driven by the anticipated rise of AI assistants and agents. He noted that one of HSBC’s recommended stocks to observe in this regard is Hong Kong-listed Sunny Optical. The company’s expertise in optics for wearable devices positions it favorably within this growing market.
- Sunny Optical’s projected shipments for smart glasses are estimated to reach:
- 2 million units in 2024
- 5 million units by 2025
- Each unit may have a content value ranging from USD $8 to $10.
- Potential collaborations with other OEMs, such as Xiaomi, could further boost these figures.
Sustained Growth Amid Challenges 📊
Sunny Optical, a key supplier for diverse products from automotive components to microscopes, has kept a relatively low public profile. However, analysts from CMB International reported that its revenue in the European and U.S. markets experienced significant growth during the fiscal first half, rising by 32% and 15%, respectively. This increase suggests robust sales, particularly from European automakers and U.S. technology giants like Apple and Meta.
Features of the Ray-Ban Meta Smart Glasses 👓
The Ray-Ban Meta smart glasses, priced around $300, enable users to take photos, record short video clips, listen to music, and utilize Meta’s AI functionalities. HSBC recorded a substantial 61% surge in Sunny Optical’s non-smartphone camera module shipments through July, attributing this rise to the strong sales performance of these smart glasses.
Market Analysis and Outlook 📉
HSBC analysts established a price target of 58.90 Hong Kong dollars (approximately $7.56) for Sunny Optical, reflecting an approximate 30% upside based on the previous closing price. Following their research, they upgraded Sunny to a buy rating at the end of August, indicating confidence in the company’s growth potential.
However, it is essential to acknowledge that Sunny Optical operates in an intensely competitive environment in the smartphone and automotive markets. Analysts from JPMorgan shared a more cautious outlook in mid-August after reviewing Sunny Optical’s earnings call. They expressed their view that while the company appears to be on a recovery path, it is expected to grow at a slower pace compared to its peers in high-end smartphone manufacturing and could face challenges in its automotive segment.
JPMorgan has set a price target of 55 Hong Kong dollars for the company, reflecting a more conservative assessment of market conditions.
Conclusion 📅
This year marks a pivotal moment for smart glasses technology, with increasing consumer acceptance and innovative developments on the horizon. With major players like Sunny Optical positioning themselves within this dynamic landscape, the future looks intriguing for smart glasses in the consumer technology industry.
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