How large (or small) is the audiophile market?

My opinion is that I think the market is going to slow in a bad economy. It will pick up in a good one. The generation of the 60s, 70s, 80's are dying off. I have a lower cost tube system, Speakers I designed, built, I stream, no investing in clicks and pops. I have a selection of 60 million titles.  Having a high end stereo is dependent on whether you have the desire to invest money in high end audio or something else. Today, we have water sports, 4 wheelers, off roaders, fishing boats that cost 48k for a nice Lund boat, a nice car like a Mustang GT, Challenger SRT, or high perf Audi, Porsche, To Corvette Jag......  My opinion, you need the ears for high end audio, you need a decent room, and a budget you can afford. High performance is not always how much money is dumped. Depends on ears.  You must love music. Rap is not music, sorry. My grand daughter who is in Korean artists loves my system which is lower scale but decent. 

I don't think the market for quality audio equipment will disappear, but I think it will contract. I'm in my late 60s and as a kid the family listened to our stereo (such as it was) for family entertainment. That entailed actually buying physical media and loading it up on the turntable. Recorded music has been commoditized for young people with ITunes and a cell phone-no more "ritual" involved. There are exponentially more entertainment choices and music is more likely to be a background thing while they are working out, etc.Quality sound is not very important in that context. One of my great pleasures is spending a couple of hours, or more, just listening to music and nothing else-my kids (in their 30s) don't get that at all.

I also think the disappearance of brick and mortar stores contributes to the shrinking market. How many young people have actually heard a reasonably competent system? In the old days, audio stores were plentiful and even if you couldn't afford to buy you were exposed to the experience if you were curious enough to walk in to a store. That's not happening much these days.

To this point, there’s companies like Acora Acoustics Corporation, which bought Audio Research as part of a private equity deal.

Acora makes stone speakers. How many people are buying their speakers a year? 5? 100? How do these companies exist?

There appears to be much more supply of high end product than any possible market for it. To prove this, I pulled a Stereophile issue from roughly 10 years ago and then researched some of the manufactures to see if they were still in business. Many were not going concerns. I don’t understand how so much new capital is being allocated to such a small market with seemingly endless new offerings. What market research is showing enough scale to the audiophile market to justify this?

The only guy I know that I would consider an audiophile owns a powerful old Marantz that he recapped himself, and he doesn’t chase more.  He is older, like myself.  With the high costs of living, and especially housing, I think younger Americans don’t have the money or interest to purchase high cost audio equipment (I know OP wasn’t asking about cost, but let’s face it — this is not a cheap hobby).  It’s appears that convenience, affordability and “good enough” are what Millennials and younger folks seek.