So-called “true wireless stereo” (TWS) headphones have seen rising demand and helped several smartphone and smart speaker brands to break out in the market over the past few years.

Demand for TWS headphones this year is estimated to increase by 80 percent annually to 92 million sets, with next year expected to bring another 40 percent increase, or 130 million to 140 million sets, KGI Securities Investment Advisory Co (凱基投顧) said in a report on Aug. 2.

As TWS products have been launched by high-end headset makers Bose Corp, Beats Electronics LLC, Bang & Olufsen and Plantronics Inc, smart speaker supplier Inc, as well as smartphone vendors Apple Inc, Samsung Electronics Co, Huawei Technologies Co (華為) and Xiaomi Corp (小米), this wireless stereo boom would benefit Taiwanese companies in the TWS supply chain, KGI said.

Apple has the highest market share in the TWS market — 50 to 55 percent — after the US company in 2016 launched its wireless AirPod earbuds for the iPhone 7.

As the company shifts greater focus to the service and accessories sectors, shipments of AirPods are estimated to increase from 30 million units last year to between 50 million and 55 million units this year, KGI said.

After Apple later this year introduces the third-generation AirPod, it is forecast that shipments next year will increase to between 70 million and 80 million units, it said.

Local companies involved in the AirPod supply chain include assembler Inventec Corp (英業達), charging box hinge maker Shin Zu Shing Co Ltd (新日興), charging box battery pack manufacturer Simplo Technology Co (新普), flexible printed-circuit board suppliers Unitech Printed Circuit Board Corp (燿華) and Compeq Manufacturing Co (華通), and plastic and metal molding components maker Concraft Holding Co (康控), the report said.

Companies in the supply chain of Android smartphone brands, which have also launched TWS headphones, are IC designer Realtek Semiconductor Corp (瑞昱) and sensor maker PixArt Imaging Inc (原相), it added.

The suppliers of professional headset brands include audio electronics makers Merry Electronics Co (美律) and Primax Electronics Ltd (致伸), as well as lithium battery maker Synergy ScienTech Corp (興能高), the report said.

New models of TWS headphones are expected to include more advanced features, such as a built-in voice assistant with noise reduction and a longer battery life, as well as being waterproof, KGI said.

Chips and sensors would be the key to these additional features, KGI added.