How To Find AirPods
Apple AirPods are displayed during a media event in San Francisco, Sept. 7, 2016. REUTERS/Beck Diefenbach

Apple’s wireless earphones, the AirPods, might soon be able to generate more revenue for the company than the Apple Watch, according to analyst and venture capitalist Gene Munster. He also predicted that the price of the AirPods will jump from the current $150 to $200 during the next ten years.

“Over the next 10 years, we anticipate that AirPods will be bigger than the Apple Watch as the product evolves from simple wireless headphones to a wearable, augmented audio device. While both AirPods and Apple Watch should continue to grow, we see AirPods contributing about the same amount of revenue as Apple Watch by FY22. We expect the AirPods ASP to increase from $159 today to $200 in FY22 as the product shifts to augmented audio,” Munster stated in a research paper published Monday titled "Apple 5-Year Model; Expect Apple Glasses In FY20."

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Munster’s prediction is that AirPods will be at par with the Apple Watch in terms of revenue contribution in a period of five years i.e. by the fiscal year 2022.

Apple doesn’t reveal its earnings from products such as the Apple Watch or the AirPods in its quarterly results. Instead, revenues from both products are included in the “other products” category. The company reported $2.87 billion revenue from the category in the first fiscal quarter this year, which is a 31 percent increase in profit, compared to $2.18 billion for the same quarter last year. It is worth noting that the Apple AirPods only became available during the same period.

The company’s CEO, Tim Cook, earlier this month said: "Demand for AirPods significantly exceeds supply, and growth in Beats products has also been very strong," said Cook. "In fact, when we combine Apple Watch, AirPods, and Beats headphones, our revenues from wearable products in the last four quarters was the size of a Fortune 500 company."

Even though the wireless earphones were launched six months ago, the Apple website is still giving a six-week shipping estimate for them.

Munster’s views are in line with analyst Neil Cybart of Above Avalon — a website that provides insight and perspective as to how Apple products — who stated in his paper titled “The curious case of Apple Product Pricing,” that the tech giant might be under pricing the AirPods in order to eliminate the competition in the wireless earphones space.

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“As Apple pushes deeper into luxury brand territory, the company is making its products more accessible through lower pricing. At $159, Apple is underpricing AirPods. The same can be said for Apple Watch, priced at $269. In just ten years, we have moved from the 'Apple Tax' days, when Apple was accused of pricing products artificially high, to Apple products being priced below the competition. Apple is using its balance sheet and scale to grab new users, and in the process, redefine luxury,” Cybart said.

The AirPods, despite their peculiar design have done well as a product, achieving 98 percent satisfaction rate in a study done by Experian and Creative Strategies in May this year.