Apple's 2014 iPads to sport Touch ID & TSMC-built A8 CPU, 12.9" iPad unlikely till 2015

In a research note obtained by AppleInsider, well-connect analyst Ming-Chi Kuo of KGI said information gathered from his sources suggest Apple will use a combination of product refreshes and price adjustments to drive 'moderate growth' in its tablet segment through the end of the calendar year.

A so-called iPad Air 2 will reportedly launch a bit earlier this year — likely late in the third quarter instead of early in the fourth — and include a next-generation A8 mobile processor manufactured for Apple by TSMC, a Touch ID fingerprint sensor, and an 8MP rear-facing camera.

According to Kuo, who boasts a respectable track record of predicting Apple's future product introductions, the iPad mini with Retina display will also get an upgrade with an A8 and Touch ID sensor despite failing to sell in the volume the iPad maker had originally expected.

The analyst blames the slower than expected sales of the latest iPad mini with Retina on Apple having repeated the same mistake it made years ago with the full-sized iPad when it thickened the device in order to build in the higher-resolution display.

"This change proved unpopular among consumers," he wrote. "We think iPad mini with Retina display made the same mistake, explaining why it's not selling as well as the previous generation of iPad mini."

This year's iPad mini with Retina display will maintain the same form factor as the current model but initially ship in limited volumes, while the previous year's model may continue to be manufactured and sold at a reduced cost.

Separately, Apple is reportedly working on a 12.9" iPad to generate new growth momentum via a richer entertainment and productivity experience. However, the analyst said the product is unlikely to make its way to market until next year, as Apple is believed to working on new usability features to accompany the release.

"With the 12.9" iPad, we think Apple will come up with a new user interface that's more innovative and intuitive, so that input will be as efficient as a device with keyboard," Kuo said.

Overall, the analyst is forecasting the new iPads to deliver moderate or "flattish" year-over-year growth for Apple in 2014 to about 73.5 million units.