1 00:00:02,520 --> 00:00:07,440 Speaker 1: Bloomberg Audio Studios, Podcasts, radio news. 2 00:00:08,680 --> 00:00:12,559 Speaker 2: This is Bloomberg Business Week with Carol Masser and Tim 3 00:00:12,600 --> 00:00:14,840 Speaker 2: Stenovak on Bloomberg Radio. 4 00:00:16,120 --> 00:00:17,960 Speaker 3: I want to get to some earnings because we're seeing 5 00:00:18,000 --> 00:00:21,439 Speaker 3: some stocks move here in the aftermarket. Intel shares they 6 00:00:21,600 --> 00:00:25,200 Speaker 3: are right now up about two percent. This is as 7 00:00:25,280 --> 00:00:27,080 Speaker 3: we got in terms of some of the big headlines 8 00:00:27,120 --> 00:00:29,960 Speaker 3: from Intel C's first quarter. Justin gross margin of thirty 9 00:00:30,000 --> 00:00:32,680 Speaker 3: six percent, that's below with the Street was forecasting of 10 00:00:32,720 --> 00:00:34,920 Speaker 3: about thirty nine point three percent. Go back to the 11 00:00:34,960 --> 00:00:38,280 Speaker 3: fourth quarter, the last quarter revenues that was a beat 12 00:00:38,400 --> 00:00:41,680 Speaker 3: fourteen point twenty six billion versus an estimate of thirteen 13 00:00:41,720 --> 00:00:45,280 Speaker 3: point eighty one billion. And again talking about first quarter revenue, 14 00:00:45,320 --> 00:00:48,000 Speaker 3: some forecasts here a bit of a range eleven point 15 00:00:48,040 --> 00:00:50,880 Speaker 3: seven billion to twelve point seven billion, and that Tim 16 00:00:50,920 --> 00:00:53,640 Speaker 3: compares with the street estimate of twelve point eighty five billion. 17 00:00:53,640 --> 00:00:56,520 Speaker 3: But again right now we're seeing Intel up about two percent. 18 00:00:56,600 --> 00:00:58,680 Speaker 3: I know they also talked about in terms of some 19 00:00:58,800 --> 00:01:02,240 Speaker 3: spending right and I think basically saying they will not 20 00:01:02,360 --> 00:01:05,280 Speaker 3: be spending speculatively. So I feel like some of that 21 00:01:05,360 --> 00:01:08,440 Speaker 3: plays to maybe some of the commentary we've had about 22 00:01:08,440 --> 00:01:11,080 Speaker 3: the AI spend maybe a rethink this past week. 23 00:01:11,240 --> 00:01:13,640 Speaker 2: Reminder too, they're also looking for a new CEO at 24 00:01:13,640 --> 00:01:15,560 Speaker 2: this point to take up for patkel Singer who left 25 00:01:15,560 --> 00:01:17,600 Speaker 2: at the end of last year. For more, let's go 26 00:01:17,640 --> 00:01:20,560 Speaker 2: to Jackie Doavolos. She's in our San Francisco bureau. She's 27 00:01:20,600 --> 00:01:24,560 Speaker 2: been following this company and these numbers closely. Jackie, how 28 00:01:24,640 --> 00:01:25,559 Speaker 2: is the turnaround going? 29 00:01:26,880 --> 00:01:29,720 Speaker 4: Well, that's the question everyone wants to know. The key 30 00:01:29,800 --> 00:01:33,480 Speaker 4: uncertainty here is who's taking over the company. You had 31 00:01:33,640 --> 00:01:36,400 Speaker 4: some guidance from the CFO as to how the next 32 00:01:36,520 --> 00:01:38,760 Speaker 4: quarter is going to look like, but not so much 33 00:01:38,800 --> 00:01:41,880 Speaker 4: guidance on who's going to be taking the reins. And 34 00:01:42,120 --> 00:01:44,880 Speaker 4: I think that's the big point of uncertainty. And if 35 00:01:44,920 --> 00:01:47,480 Speaker 4: you look at shares, it's kind of a tepid response 36 00:01:47,560 --> 00:01:50,920 Speaker 4: considering how much uncertainty is swirling around the company right now. 37 00:01:51,000 --> 00:01:54,160 Speaker 4: But to your point, Carol, I think some of that 38 00:01:54,280 --> 00:01:57,920 Speaker 4: optimism is coming in through the comments around spend. As 39 00:01:57,960 --> 00:02:01,800 Speaker 4: you know, the former CEO, Pat gal Singer was ousted 40 00:02:02,080 --> 00:02:05,240 Speaker 4: just last month, and big part of the reason for 41 00:02:05,320 --> 00:02:09,120 Speaker 4: that was this ordinate amount of spending that the board 42 00:02:09,200 --> 00:02:12,359 Speaker 4: perceived to be a drag on the company's performance. Now, 43 00:02:12,400 --> 00:02:14,880 Speaker 4: we might not know who might be taking over, but 44 00:02:14,960 --> 00:02:17,359 Speaker 4: what we do know is that next quarter they're looking 45 00:02:17,400 --> 00:02:21,080 Speaker 4: at revenue of about eleven point seven to twelve point 46 00:02:21,080 --> 00:02:25,160 Speaker 4: seven billion dollars. That's below estimates, but perhaps some of 47 00:02:25,200 --> 00:02:28,040 Speaker 4: that optimism from the fact that they beat pretty well 48 00:02:28,120 --> 00:02:30,919 Speaker 4: on their revenue figures for the fourth quarter is coming through. 49 00:02:31,440 --> 00:02:33,960 Speaker 3: Yeah, it's interesting just looking through to some of the 50 00:02:34,840 --> 00:02:37,800 Speaker 3: reporting from Ouroni and King of course, who follows the 51 00:02:37,880 --> 00:02:40,519 Speaker 3: chips sector, and saying that you know, again, what you 52 00:02:40,560 --> 00:02:43,120 Speaker 3: guys were just talking about investors in analyst waiting for 53 00:02:43,160 --> 00:02:46,359 Speaker 3: the appointment of a new leader who will determine Intel's future. 54 00:02:46,360 --> 00:02:49,640 Speaker 3: I mean, it's a big question. The company's outsource manufacturing 55 00:02:49,639 --> 00:02:52,680 Speaker 3: push will not see meaningful revenue from silicon customers until 56 00:02:52,680 --> 00:02:55,160 Speaker 3: twenty twenty seven. For now, the bulk of outside sales 57 00:02:55,200 --> 00:02:57,720 Speaker 3: will come from packing works. So we're getting a little 58 00:02:57,720 --> 00:02:59,639 Speaker 3: bit more in terms of the business here, Tim. But again, 59 00:02:59,800 --> 00:03:02,360 Speaker 3: the stock, as Jackie mentioned, just pulling it up again 60 00:03:02,680 --> 00:03:05,200 Speaker 3: here in the aftermarket, and the stock right now just 61 00:03:05,280 --> 00:03:07,320 Speaker 3: up about one point two percent here. But it's not 62 00:03:07,440 --> 00:03:08,680 Speaker 3: selling off, which is interesting. 63 00:03:08,720 --> 00:03:10,120 Speaker 2: I mean, there's been a lot of selling off of 64 00:03:10,120 --> 00:03:13,480 Speaker 2: the last few years with Intel to you know, when 65 00:03:13,480 --> 00:03:16,480 Speaker 2: you zoom out, of course, Jackie, the data center business 66 00:03:16,520 --> 00:03:21,359 Speaker 2: certainly facing competition from Nvidia and AMD their core business 67 00:03:21,440 --> 00:03:25,480 Speaker 2: PC processors. How is demand there, how's competition there? 68 00:03:26,160 --> 00:03:29,640 Speaker 4: Well, we got some comments from the CFO who said 69 00:03:29,639 --> 00:03:34,160 Speaker 4: that competitive dynamics is a big reason why we're seeing 70 00:03:34,200 --> 00:03:36,480 Speaker 4: a bit of a weaker forecast. He also cited the 71 00:03:36,520 --> 00:03:40,800 Speaker 4: macro uncertainties and of course seasonal weakness. But when we 72 00:03:40,880 --> 00:03:44,280 Speaker 4: go back to those competitive dynamics, who is the competition 73 00:03:44,440 --> 00:03:48,920 Speaker 4: and tim You're absolutely right, those AI accelerators are the 74 00:03:48,960 --> 00:03:52,360 Speaker 4: big question for investors. Can they get in here and compete? 75 00:03:52,400 --> 00:03:55,400 Speaker 4: Obviously with the gold standard coming from Nvidia, it's going 76 00:03:55,440 --> 00:03:57,840 Speaker 4: to take a lot of work and investment to really 77 00:03:57,960 --> 00:04:00,440 Speaker 4: chip away there. But in the meantime they're also facing 78 00:04:00,440 --> 00:04:04,280 Speaker 4: competition from their bread and butter in that processing personal 79 00:04:04,280 --> 00:04:08,760 Speaker 4: computer processing unit. You have AMD really coming in, and 80 00:04:08,800 --> 00:04:12,839 Speaker 4: then of course on the outsourcing manufacturing site, Taiwan Semiconductors 81 00:04:12,920 --> 00:04:15,560 Speaker 4: is also a pretty big player now, so they're kind 82 00:04:15,560 --> 00:04:19,800 Speaker 4: of facing this competition from all ends. Even you know, 83 00:04:19,880 --> 00:04:23,760 Speaker 4: as we look at AI being this big opportunity for 84 00:04:23,880 --> 00:04:26,760 Speaker 4: pretty much every tech player out there. Intel has really 85 00:04:26,800 --> 00:04:29,440 Speaker 4: been struggling to make a name for themselves in the space. 86 00:04:29,800 --> 00:04:32,599 Speaker 3: Just to rehash, Intel shares folks in the aftermarket up 87 00:04:32,600 --> 00:04:34,919 Speaker 3: about one point three percent. Going to the first quarter 88 00:04:35,000 --> 00:04:38,040 Speaker 3: forecast seeing revenue of eleven point seven billion to twelve 89 00:04:38,040 --> 00:04:40,960 Speaker 3: point seven billion. The estimate on the street is twelve 90 00:04:40,960 --> 00:04:45,000 Speaker 3: point eighty five billion, so above that. Also in terms 91 00:04:45,000 --> 00:04:49,960 Speaker 3: of forecasts, he's an adjusted EPs of just flat. Estimate 92 00:04:50,040 --> 00:04:51,880 Speaker 3: is for eight cents. He's a justin gross margin of 93 00:04:51,920 --> 00:04:54,400 Speaker 3: thirty six percent. That's a miss too. Estimate is thirty 94 00:04:54,480 --> 00:04:57,080 Speaker 3: nine point three percent. Go back to the fourth quarter 95 00:04:57,279 --> 00:05:00,880 Speaker 3: and their current quarter sales and profit forcat asked falling 96 00:05:00,880 --> 00:05:02,919 Speaker 3: short of analyst projections. But if we go back to 97 00:05:02,960 --> 00:05:06,359 Speaker 3: the fourth quarter fourteen point two six billion, that's the 98 00:05:06,400 --> 00:05:09,120 Speaker 3: revenue that's down seven point four percent year over year. 99 00:05:09,160 --> 00:05:11,640 Speaker 3: The estimate on the street was thirteen point eight billion. 100 00:05:12,440 --> 00:05:15,120 Speaker 3: But again the key thing as we're talking about, you know, 101 00:05:15,440 --> 00:05:19,200 Speaker 3: not yet having any update on a permanent CEO. The 102 00:05:19,279 --> 00:05:22,920 Speaker 3: interim co CEO David Sisner saying our first quarter one 103 00:05:23,160 --> 00:05:25,880 Speaker 3: or quarter one outlook, I should say, reflects seasonal weakness 104 00:05:25,960 --> 00:05:31,480 Speaker 3: magnified by macro uncertainties. Further inventory digestion, and competitive dynamics. 105 00:05:32,240 --> 00:05:34,920 Speaker 3: Jackie sounds like a super full plate. We know it's 106 00:05:34,960 --> 00:05:37,120 Speaker 3: been a full plate for Intel, but it still is. 107 00:05:37,240 --> 00:05:39,440 Speaker 3: It's a reminder at least that it still is. 108 00:05:39,960 --> 00:05:43,120 Speaker 4: One hundred percent. And as we look to the conference 109 00:05:43,160 --> 00:05:45,719 Speaker 4: call with analysts, the big question is going to be 110 00:05:46,240 --> 00:05:51,040 Speaker 4: not just an update for leadership, but also in this interim, 111 00:05:51,400 --> 00:05:53,839 Speaker 4: what's the game plan here, because now that you're seeing 112 00:05:53,960 --> 00:05:57,520 Speaker 4: kind of spend really being scrutinized after the deep Seek 113 00:05:57,640 --> 00:06:00,600 Speaker 4: drama earlier this week, it's sort of effect those who 114 00:06:01,080 --> 00:06:04,600 Speaker 4: might have been perhaps exempt from that kind of scrutiny 115 00:06:04,640 --> 00:06:08,800 Speaker 4: before these open you know, AI, other AI developer kind 116 00:06:08,800 --> 00:06:11,960 Speaker 4: of players out there, and so obviously this is nothing 117 00:06:12,000 --> 00:06:14,680 Speaker 4: new for Intel, but of course I think that might 118 00:06:14,800 --> 00:06:17,200 Speaker 4: be you know, some of the guidance that they want 119 00:06:17,320 --> 00:06:21,360 Speaker 4: this this conservative spend, What does that mean, How does 120 00:06:21,400 --> 00:06:23,719 Speaker 4: it look like in practice at a time when it 121 00:06:23,760 --> 00:06:26,239 Speaker 4: is going to take investment to really kind of break 122 00:06:26,240 --> 00:06:29,880 Speaker 4: into this AI space. Another thing that we'll be looking 123 00:06:29,920 --> 00:06:32,920 Speaker 4: out for in the conference call, it's just any more 124 00:06:32,960 --> 00:06:36,360 Speaker 4: guidance around what the company plans to do to perhaps 125 00:06:36,440 --> 00:06:39,000 Speaker 4: offset some of the weaknesses in its bread and butter 126 00:06:39,080 --> 00:06:42,640 Speaker 4: business in these personal computers. You know, what, what does 127 00:06:42,640 --> 00:06:46,400 Speaker 4: it plan to do about this kind of new competition 128 00:06:46,520 --> 00:06:49,279 Speaker 4: coming from Taiwan Semiconductors. I think That's what I'm going 129 00:06:49,360 --> 00:06:51,000 Speaker 4: to be looking out for in the upcoming call. 130 00:06:51,279 --> 00:06:54,520 Speaker 2: I think what still surprises me, Jackie is this is 131 00:06:54,560 --> 00:06:57,000 Speaker 2: a company that has no full time CEO, and you 132 00:06:57,040 --> 00:06:59,200 Speaker 2: had Pat Gelslinger out earlier this week. We talked about 133 00:06:59,200 --> 00:07:02,880 Speaker 2: this with Ian King tweeting that he was buying shares 134 00:07:02,880 --> 00:07:06,880 Speaker 2: of Nvidia during the down during the decline of Nvidia 135 00:07:07,320 --> 00:07:10,880 Speaker 2: on Monday, he wrote about that on LinkedIn, and it 136 00:07:10,920 --> 00:07:12,720 Speaker 2: was surprising to see that I'm not, you know, here 137 00:07:12,720 --> 00:07:16,160 Speaker 2: to talk about Gelsinger. What I am wondering from you 138 00:07:16,200 --> 00:07:18,760 Speaker 2: about is what are analysts saying about the type of 139 00:07:18,840 --> 00:07:21,520 Speaker 2: leader who could come in and turn this company around? Like, 140 00:07:21,600 --> 00:07:23,280 Speaker 2: who are the names? Do we have names that are 141 00:07:23,280 --> 00:07:26,040 Speaker 2: being thrown around at this point? Do we have a timeline, 142 00:07:26,440 --> 00:07:27,000 Speaker 2: what do we know? 143 00:07:28,160 --> 00:07:31,240 Speaker 4: I don't think there's too much that we do know 144 00:07:31,640 --> 00:07:35,720 Speaker 4: other than you know, the big point of scrutiny has 145 00:07:35,800 --> 00:07:38,560 Speaker 4: been spend and if you're going to bring in a 146 00:07:38,680 --> 00:07:41,920 Speaker 4: leader that can kind of articulate a new vision for 147 00:07:42,000 --> 00:07:45,119 Speaker 4: the company still kind of, you know, bring it something 148 00:07:45,160 --> 00:07:50,240 Speaker 4: that's forward looking, that is not going to be predicated 149 00:07:50,360 --> 00:07:52,480 Speaker 4: on a plan that is going to take, you know, 150 00:07:52,600 --> 00:07:54,760 Speaker 4: five to ten years to pan out, because I think 151 00:07:54,800 --> 00:07:56,600 Speaker 4: what investors want to see is what can we do 152 00:07:56,680 --> 00:07:59,720 Speaker 4: with what we have now? And you know, obviously a 153 00:07:59,760 --> 00:08:03,040 Speaker 4: pet Elsinger didn't get to live out his full five 154 00:08:03,120 --> 00:08:05,640 Speaker 4: year plan, but you know, he did put in in 155 00:08:05,760 --> 00:08:09,040 Speaker 4: place a solid foundation that I think a new CEO 156 00:08:09,120 --> 00:08:11,560 Speaker 4: can can work with. So some of the notes that 157 00:08:11,600 --> 00:08:14,240 Speaker 4: we've been seeing from the street include, you know, what 158 00:08:14,320 --> 00:08:17,680 Speaker 4: can be done with what foundation currently exists? 159 00:08:18,240 --> 00:08:19,240 Speaker 3: Because it's not nothing. 160 00:08:19,320 --> 00:08:22,480 Speaker 4: You know, some solid investments have been made, some good 161 00:08:22,520 --> 00:08:24,800 Speaker 4: inroads have been made, but I think it's just a 162 00:08:24,800 --> 00:08:27,440 Speaker 4: matter of kind of that conservative spend how far can 163 00:08:27,480 --> 00:08:27,960 Speaker 4: that take them? 164 00:08:28,120 --> 00:08:30,840 Speaker 3: Hey, all right, Jackie, thank you so much. Jackie Devallas, 165 00:08:30,880 --> 00:08:34,080 Speaker 3: Bloomberg News Tech reporter joining us with the latest on Intel. 166 00:08:34,200 --> 00:08:36,559 Speaker 3: Keeping a watch on it as it moves up just 167 00:08:36,600 --> 00:08:38,280 Speaker 3: a little bit in the aftermarket. Do you want to 168 00:08:38,320 --> 00:08:42,920 Speaker 3: mention KLA Corp. Semiconductor manufacturing equipment company up about four 169 00:08:42,960 --> 00:08:46,079 Speaker 3: and a half percent in the aftermarket following its earnings, 170 00:08:46,559 --> 00:08:49,160 Speaker 3: looking at what the company has to say, second quarter 171 00:08:49,160 --> 00:08:52,360 Speaker 3: adjusted gross margins sixty one point seven percent, slightly better 172 00:08:52,440 --> 00:08:56,960 Speaker 3: than the street expected third quarter adjusted gross margin, so 173 00:08:57,240 --> 00:09:01,000 Speaker 3: looking towards the current quarter sixty one to sixty three percent. 174 00:09:01,040 --> 00:09:03,600 Speaker 3: Also talking about third quarter revenue, they're looking for two 175 00:09:03,600 --> 00:09:07,240 Speaker 3: point eighty five to three point fifteen million billion, excuse me, 176 00:09:07,320 --> 00:09:09,680 Speaker 3: and that is better than the street expected. So that 177 00:09:09,720 --> 00:09:11,880 Speaker 3: explains where you're seeing this stock up. Do not go anywhere. 178 00:09:11,920 --> 00:09:22,000 Speaker 3: Apple to come in just a moment. The earnings continuing 179 00:09:22,080 --> 00:09:25,000 Speaker 3: to come out. We are awaiting Apple, which is set 180 00:09:25,040 --> 00:09:27,320 Speaker 3: to report in just about seven minutes at the bottom 181 00:09:27,360 --> 00:09:29,319 Speaker 3: of the hour four to thirty pm Wall Street time, 182 00:09:29,360 --> 00:09:31,480 Speaker 3: So as soon as they cross, we will bring them 183 00:09:31,520 --> 00:09:35,120 Speaker 3: to you. A reminder of the company. We'll report for 184 00:09:35,240 --> 00:09:37,760 Speaker 3: the quarter despite some head wind stepping from China, the 185 00:09:37,760 --> 00:09:40,720 Speaker 3: slow rollout of in house AI future features. So there's 186 00:09:40,760 --> 00:09:42,920 Speaker 3: a lot coming at us when it comes to Apple 187 00:09:42,960 --> 00:09:45,360 Speaker 3: in particular, a lot coming at us when it comes 188 00:09:45,400 --> 00:09:47,800 Speaker 3: to the whole tech sector. This week, Angela Zino is 189 00:09:47,840 --> 00:09:51,079 Speaker 3: senior equeritly alyist over at CFRAA. He joins us from 190 00:09:51,120 --> 00:09:54,120 Speaker 3: New York City. Angelo, I do want to start with 191 00:09:54,240 --> 00:09:59,040 Speaker 3: Intel because they just came out certainly a big part 192 00:09:59,120 --> 00:10:01,480 Speaker 3: of the semi second, but they're also going through, of course, 193 00:10:01,559 --> 00:10:04,960 Speaker 3: some changes, waiting for a new CEO, new leader, a 194 00:10:04,960 --> 00:10:08,520 Speaker 3: new way forward. Initial thoughts on Intel. 195 00:10:09,760 --> 00:10:10,920 Speaker 5: Yeah, now, thanks for having me. 196 00:10:11,000 --> 00:10:13,360 Speaker 6: So, you know, you kind of look at the results overall, 197 00:10:13,520 --> 00:10:16,800 Speaker 6: and I would say they were okay. I mean, as 198 00:10:16,800 --> 00:10:19,360 Speaker 6: far as the results were concerned, I think earnings about 199 00:10:19,400 --> 00:10:22,880 Speaker 6: thirteen cents, sales were down seven percent, roughly kind of 200 00:10:23,280 --> 00:10:25,760 Speaker 6: in line where we were expecting. I think as far 201 00:10:25,800 --> 00:10:27,679 Speaker 6: as the guidance is concerned, it was definitely on the 202 00:10:27,760 --> 00:10:31,360 Speaker 6: lighter side of things, but you know, nothing abysmal, nothing 203 00:10:31,400 --> 00:10:33,840 Speaker 6: like we've seen in past quarters where they've kind of 204 00:10:34,040 --> 00:10:36,360 Speaker 6: missed by a much wider margin. So as far as 205 00:10:36,400 --> 00:10:38,720 Speaker 6: kind of the results are concerned, I think it was 206 00:10:38,800 --> 00:10:42,680 Speaker 6: perfectly fine, you know, within kind of you know, segments wise. 207 00:10:42,720 --> 00:10:45,000 Speaker 6: I think the client computing group, which is kind of 208 00:10:45,000 --> 00:10:47,720 Speaker 6: more their their PC business was down about nine percent, 209 00:10:47,920 --> 00:10:49,480 Speaker 6: and when you kind of look at their data center 210 00:10:49,520 --> 00:10:53,720 Speaker 6: business down about three percent. Again, I mean, it was 211 00:10:53,840 --> 00:10:58,400 Speaker 6: kind of where we had expected largely. So yeah, I 212 00:10:58,400 --> 00:11:00,719 Speaker 6: mean I think it's one of those situations where this 213 00:11:00,760 --> 00:11:03,480 Speaker 6: company is kind of just kind of going through the motions, 214 00:11:03,520 --> 00:11:05,240 Speaker 6: and we're just kind of waiting to see kind of 215 00:11:05,280 --> 00:11:07,679 Speaker 6: who that next CEO is going to be and what 216 00:11:07,679 --> 00:11:09,760 Speaker 6: they have to say on the call as far as 217 00:11:09,840 --> 00:11:13,400 Speaker 6: kind of cost cutting this concern here in the intermediate term, I. 218 00:11:13,320 --> 00:11:14,880 Speaker 2: Could have asked you the same question I'm going to 219 00:11:14,920 --> 00:11:18,120 Speaker 2: ask you Angelo anytime over the last three years, where 220 00:11:18,160 --> 00:11:19,400 Speaker 2: is Intel in its turnaround? 221 00:11:22,360 --> 00:11:25,760 Speaker 6: You know, it's it's a it's a tough one because, yeah, 222 00:11:26,000 --> 00:11:28,400 Speaker 6: there they continue to have to kind of restart in 223 00:11:28,520 --> 00:11:32,240 Speaker 6: terms of you know, where they're at, I mean you 224 00:11:32,320 --> 00:11:35,079 Speaker 6: and and it's typically because of the fact that they 225 00:11:35,080 --> 00:11:38,240 Speaker 6: haven't really kind of given you know, the existing leadership team, 226 00:11:38,440 --> 00:11:41,520 Speaker 6: you know, enough time to kind of you know, watch 227 00:11:41,559 --> 00:11:43,400 Speaker 6: their vision to really come to fruition. 228 00:11:43,559 --> 00:11:45,960 Speaker 5: I think right now where we're looking at is you know, 229 00:11:46,200 --> 00:11:47,679 Speaker 5: you need you need a new CEO. 230 00:11:47,800 --> 00:11:49,920 Speaker 6: I think when you kind of look at their core business, 231 00:11:50,120 --> 00:11:52,720 Speaker 6: it's really kind of under attack. Right on the PC 232 00:11:52,920 --> 00:11:54,920 Speaker 6: side of things. You hear things like you know, ARM 233 00:11:54,920 --> 00:11:57,160 Speaker 6: looking to take half the half the market. On that 234 00:11:57,240 --> 00:11:59,040 Speaker 6: side of things, you got got the kind of greater 235 00:11:59,120 --> 00:12:01,120 Speaker 6: competitive pressure. 236 00:12:00,400 --> 00:12:01,240 Speaker 5: Going on there. 237 00:12:01,320 --> 00:12:03,360 Speaker 6: You kind of look on the data center side of things, 238 00:12:03,400 --> 00:12:06,800 Speaker 6: they don't have the right offerings there. I mean, CPUs 239 00:12:06,960 --> 00:12:08,920 Speaker 6: are kind of a thing of the past at this 240 00:12:09,000 --> 00:12:11,800 Speaker 6: point in time, and you've got you know these you know, 241 00:12:11,880 --> 00:12:14,800 Speaker 6: these hyperscalers out there kind of rolling out their own 242 00:12:15,360 --> 00:12:19,160 Speaker 6: CPU offerings. So it is it is a very difficult 243 00:12:19,160 --> 00:12:21,199 Speaker 6: time for Intel at this point in time. There's really 244 00:12:21,280 --> 00:12:24,000 Speaker 6: kind of no direction. You need that direction. So the 245 00:12:24,040 --> 00:12:26,720 Speaker 6: faster you get a CEO. 246 00:12:26,040 --> 00:12:26,520 Speaker 5: The better. 247 00:12:27,080 --> 00:12:29,240 Speaker 6: Again, this is kind of almost a race to the bottom, 248 00:12:29,320 --> 00:12:32,320 Speaker 6: it seems like right now in terms of kind of 249 00:12:32,320 --> 00:12:36,360 Speaker 6: continue to continuing to course as their revenue trajectory continues 250 00:12:36,400 --> 00:12:39,280 Speaker 6: to go down. I think really kind of if I'm 251 00:12:39,320 --> 00:12:42,199 Speaker 6: looking at this company, it's all about how they can 252 00:12:42,240 --> 00:12:44,600 Speaker 6: execute on the foundry side of things right now. If 253 00:12:44,640 --> 00:12:47,079 Speaker 6: you're thinking about a turnaround going into the second half 254 00:12:47,120 --> 00:12:49,360 Speaker 6: of the year, I mean, you've got eighteen A that's 255 00:12:49,400 --> 00:12:52,920 Speaker 6: that's kind of been long awaited and hyped up panther Laics, 256 00:12:52,920 --> 00:12:54,599 Speaker 6: it's supposed to ramp here in the second half of 257 00:12:54,640 --> 00:12:56,640 Speaker 6: the year. We want to see kind of what kind 258 00:12:56,679 --> 00:12:59,160 Speaker 6: of customers like, you know, start ramping on that side 259 00:12:59,160 --> 00:13:02,120 Speaker 6: of things. You're not going to have a major hyperscaler 260 00:13:02,160 --> 00:13:04,280 Speaker 6: out there all of a sudden just give business to Intel, 261 00:13:04,559 --> 00:13:07,200 Speaker 6: they need to kind of execute on that side of things. 262 00:13:07,200 --> 00:13:08,920 Speaker 6: So that's where we're at right now. I think they 263 00:13:08,920 --> 00:13:11,200 Speaker 6: need to start show some sort of promise on the 264 00:13:11,200 --> 00:13:13,480 Speaker 6: foundry side of things, and hopefully they can kind of 265 00:13:13,520 --> 00:13:14,760 Speaker 6: gain some momentum from there. 266 00:13:16,520 --> 00:13:19,720 Speaker 2: I got to tell you, I get these emails on 267 00:13:19,760 --> 00:13:23,800 Speaker 2: the terminal when stories are read at like a high rate, 268 00:13:23,880 --> 00:13:28,360 Speaker 2: those read spikes. People want to know about Apple. It 269 00:13:28,440 --> 00:13:31,480 Speaker 2: says that to Apple that our live blog on Apple 270 00:13:31,520 --> 00:13:35,240 Speaker 2: Carol is already hitting a red spike before those numbers 271 00:13:35,280 --> 00:13:39,360 Speaker 2: come out. We're expecting those numbers in just about two minutes. Angelo, China, 272 00:13:40,280 --> 00:13:43,360 Speaker 2: is that the biggest concern? We saw some downgrades the 273 00:13:43,400 --> 00:13:44,240 Speaker 2: early part of this year. 274 00:13:45,280 --> 00:13:47,640 Speaker 6: Yeah, I mean it seems like, you know, when you 275 00:13:47,720 --> 00:13:49,600 Speaker 6: kind of look here over the last couple of years, 276 00:13:50,600 --> 00:13:53,040 Speaker 6: January just hasn't been a good month for Apple, and 277 00:13:53,559 --> 00:13:54,959 Speaker 6: you know, you can kind of say maybe a part 278 00:13:55,000 --> 00:13:56,959 Speaker 6: of that is seasonality and what have you. I think 279 00:13:57,040 --> 00:13:59,320 Speaker 6: obviously the other issue is you kind of look over 280 00:13:59,320 --> 00:14:01,920 Speaker 6: the last two three years, the competitive pressures have. 281 00:14:01,960 --> 00:14:03,680 Speaker 5: Definitely escalated out in China. 282 00:14:03,720 --> 00:14:06,840 Speaker 6: I mean, Huawei has become you know, a real threat 283 00:14:06,920 --> 00:14:10,000 Speaker 6: again at the high end of the market, and you know, 284 00:14:10,160 --> 00:14:12,480 Speaker 6: we kind of want to know what's going on with China. 285 00:14:12,640 --> 00:14:15,160 Speaker 6: It's somewhat of a black box at this point in time, 286 00:14:15,640 --> 00:14:17,520 Speaker 6: and you kind of look at some of the sell 287 00:14:17,559 --> 00:14:20,280 Speaker 6: through numbers that have been posted, you know, specifically by 288 00:14:20,320 --> 00:14:22,280 Speaker 6: the Chinese government here late in the year. 289 00:14:22,480 --> 00:14:23,600 Speaker 5: The numbers don't look good. 290 00:14:23,640 --> 00:14:26,200 Speaker 6: And I think most people realize that most investors are 291 00:14:26,240 --> 00:14:28,960 Speaker 6: kind of going into these numbers knowing that China or 292 00:14:28,960 --> 00:14:31,240 Speaker 6: expecting that China is not going to be good. The 293 00:14:31,360 --> 00:14:33,480 Speaker 6: question is how bad is it? You know, we are 294 00:14:33,480 --> 00:14:34,720 Speaker 6: we kind of going to have to deal with some 295 00:14:34,760 --> 00:14:38,000 Speaker 6: sort of excess inventoryous situation where they're going to start 296 00:14:38,000 --> 00:14:40,560 Speaker 6: discounting more than we expect and it's going to, you know, 297 00:14:41,040 --> 00:14:43,680 Speaker 6: look like an ugly March Quarter in terms of the guidance, 298 00:14:44,080 --> 00:14:46,080 Speaker 6: I think that's at this point what we're looking at. 299 00:14:46,120 --> 00:14:47,840 Speaker 6: But in terms of the biggest risk kind of going 300 00:14:47,880 --> 00:14:49,560 Speaker 6: into the print here and as far as the March 301 00:14:49,640 --> 00:14:52,400 Speaker 6: Quarter is concerned, it's absolutely China. And we also know 302 00:14:52,480 --> 00:14:54,880 Speaker 6: as far as the March Quarter guidance is concerned, it's 303 00:14:54,920 --> 00:14:56,560 Speaker 6: going to be someone on the weaker side of things 304 00:14:56,600 --> 00:14:58,480 Speaker 6: because of the four X uncertainties, you. 305 00:14:58,400 --> 00:15:02,080 Speaker 3: Know, Angela. We're just about forty seconds away from those 306 00:15:02,240 --> 00:15:04,760 Speaker 3: Apple earnings. Stocks down about five percent. We know it's 307 00:15:04,760 --> 00:15:08,520 Speaker 3: been lagging some of it's tech brethren. If you will, 308 00:15:09,120 --> 00:15:11,880 Speaker 3: question is kind of what's next for Apple? What could 309 00:15:11,920 --> 00:15:15,280 Speaker 3: they say today that might give some indication of what's next. 310 00:15:15,320 --> 00:15:17,280 Speaker 3: They've started to give some clues. Just got about twenty 311 00:15:17,320 --> 00:15:17,880 Speaker 3: seconds here. 312 00:15:18,800 --> 00:15:21,040 Speaker 6: I think the hope is that you get a better 313 00:15:21,080 --> 00:15:23,960 Speaker 6: than fear type number really on China. I think that's 314 00:15:24,040 --> 00:15:25,600 Speaker 6: kind of the big thing. And then of course on 315 00:15:25,600 --> 00:15:27,680 Speaker 6: the services side of things, you want to make sure 316 00:15:27,720 --> 00:15:30,320 Speaker 6: that that's running on all cylinders. We're going to hopefully 317 00:15:30,360 --> 00:15:32,840 Speaker 6: continue to get double digit growth. And I think if 318 00:15:32,840 --> 00:15:34,360 Speaker 6: you can kind of get you know, those two kind 319 00:15:34,400 --> 00:15:36,920 Speaker 6: of things running, I think that should be enough as 320 00:15:36,960 --> 00:15:38,960 Speaker 6: far as kind of where the stock is at and 321 00:15:38,960 --> 00:15:39,960 Speaker 6: the pullback that we've seen. 322 00:15:40,160 --> 00:15:42,440 Speaker 3: All right, folks, we're talking with Angelo's, you know, senior 323 00:15:42,440 --> 00:15:45,040 Speaker 3: equity analyst over at CFR Research. He's going to stay 324 00:15:45,080 --> 00:15:47,320 Speaker 3: with us as we get ready for those Apple earnings 325 00:15:47,360 --> 00:15:49,880 Speaker 3: and they are crossing. So let's go through some of 326 00:15:49,880 --> 00:15:52,480 Speaker 3: the numbers. First quarter revenue one hundred and twenty four 327 00:15:52,480 --> 00:15:56,040 Speaker 3: point three billion. That is just a hair better than 328 00:15:56,080 --> 00:15:58,560 Speaker 3: what the street was expecting. One hundred and twenty four 329 00:15:58,600 --> 00:16:00,760 Speaker 3: point one billion is what the street was looking for. 330 00:16:01,280 --> 00:16:04,480 Speaker 3: Products revenue ninety seven point ninety six billion, that's up 331 00:16:04,520 --> 00:16:06,920 Speaker 3: about one point six percent year over year. Ten that's 332 00:16:06,920 --> 00:16:10,080 Speaker 3: a little bit light. Ninety eight point zero two billion. 333 00:16:10,160 --> 00:16:13,440 Speaker 3: You break it down. iPhone, the all important iPhone number, 334 00:16:14,200 --> 00:16:17,720 Speaker 3: sixty nine point fourteen billion, that is down year over year. 335 00:16:18,200 --> 00:16:20,800 Speaker 3: Estimate was for seventy one point zero four billion. 336 00:16:20,680 --> 00:16:23,040 Speaker 2: And then you keep going down at China revenue, big 337 00:16:23,040 --> 00:16:26,520 Speaker 2: miss there, estimates for twenty one point six billion dollars 338 00:16:26,760 --> 00:16:30,000 Speaker 2: that came in at eighteen point five to one billion dollars. Wearables, 339 00:16:30,000 --> 00:16:33,080 Speaker 2: home and accessories coming in just shy of estimates. MAC 340 00:16:33,160 --> 00:16:37,000 Speaker 2: revenue coming in above estimates, iPad revenue coming in above estimates. 341 00:16:37,200 --> 00:16:40,760 Speaker 2: First quarter products revenue coming in shi of estimates. But Carol, 342 00:16:40,880 --> 00:16:43,280 Speaker 2: what we're talking about right now, iPhone revenue coming in 343 00:16:43,360 --> 00:16:46,120 Speaker 2: light sixty nine point one four billion versus estimates of 344 00:16:46,160 --> 00:16:49,360 Speaker 2: seventy one billion, and that China number significantly lower than 345 00:16:49,360 --> 00:16:51,760 Speaker 2: analysts one to see coming in at eighteen point five 346 00:16:51,800 --> 00:16:52,440 Speaker 2: to one billion. 347 00:16:52,560 --> 00:16:55,160 Speaker 3: Apple also maintaining its cash dividend of twenty five cents 348 00:16:55,160 --> 00:16:57,360 Speaker 3: a share. I should say the stock has been bouncing 349 00:16:57,400 --> 00:17:01,400 Speaker 3: around in the aftermarket. We've seen it up about one percent. 350 00:17:01,520 --> 00:17:03,920 Speaker 3: Right now, it's just up about six tenths of a 351 00:17:03,960 --> 00:17:08,000 Speaker 3: percent of half a percent. Angelo Zeno come on in 352 00:17:08,000 --> 00:17:13,080 Speaker 3: initial thoughts on the first headlines off of this earnings release. 353 00:17:14,240 --> 00:17:16,320 Speaker 6: Yeah, I mean, I think this is kind of a 354 00:17:16,359 --> 00:17:20,880 Speaker 6: situation where, you know, execution was I think as good 355 00:17:20,880 --> 00:17:22,280 Speaker 6: as you could have asked for. I mean, as far 356 00:17:22,280 --> 00:17:24,639 Speaker 6: as the top line is concerned, roughly in line. I 357 00:17:24,640 --> 00:17:26,760 Speaker 6: think the expectation again was about you know, one hundred 358 00:17:26,760 --> 00:17:29,159 Speaker 6: and twenty four billion, so you're looking at what was 359 00:17:29,160 --> 00:17:31,040 Speaker 6: it maybe three point eight percent or close to four 360 00:17:31,040 --> 00:17:33,960 Speaker 6: percent growth, let's call it, as far as kind of 361 00:17:33,960 --> 00:17:35,880 Speaker 6: on a year of a year growth rate. And I mean, 362 00:17:36,280 --> 00:17:39,560 Speaker 6: I think Tim kind of highlighted the iPhone numbers were 363 00:17:39,560 --> 00:17:43,040 Speaker 6: definitely a disappointment and the China numbers, so it's definitely 364 00:17:43,240 --> 00:17:46,760 Speaker 6: a China iPhone problem as far as the quarter is concerned, 365 00:17:46,760 --> 00:17:50,400 Speaker 6: and why we missed. And again, the expectations going into 366 00:17:50,440 --> 00:17:53,280 Speaker 6: the quarter was it was going to be a challenge, 367 00:17:53,320 --> 00:17:54,920 Speaker 6: and the fact that they had been able to kind 368 00:17:54,960 --> 00:17:58,720 Speaker 6: of navigate and still meet the numbers despite those issues, 369 00:17:59,720 --> 00:18:01,480 Speaker 6: I think kind of helps maybe do you risk the 370 00:18:01,520 --> 00:18:03,760 Speaker 6: stock at least when you kind of look at the 371 00:18:04,080 --> 00:18:06,000 Speaker 6: numbers this quarter. I mean, we'll see what the March 372 00:18:06,040 --> 00:18:08,960 Speaker 6: quarter guidance is going to look like. But my guess 373 00:18:09,000 --> 00:18:11,560 Speaker 6: is you're going to continue to see the further weakness 374 00:18:11,600 --> 00:18:13,400 Speaker 6: on the China iPhone side of things. 375 00:18:13,520 --> 00:18:17,840 Speaker 2: Angelo, how much of the iPhone miss can you attribute 376 00:18:17,880 --> 00:18:22,359 Speaker 2: to China? Is is the iPhone miss just a result 377 00:18:22,359 --> 00:18:22,840 Speaker 2: of China? 378 00:18:24,840 --> 00:18:26,440 Speaker 6: It seems like it, to be honest with you, just 379 00:18:26,480 --> 00:18:28,679 Speaker 6: kind of giving just given the high level numbers that 380 00:18:28,680 --> 00:18:33,040 Speaker 6: I'm hearing from you, it just seems like the weakness is. 381 00:18:33,000 --> 00:18:34,840 Speaker 5: Really kind of you know, all China. 382 00:18:35,240 --> 00:18:38,600 Speaker 6: And you know, my guess is, you know, Western markets 383 00:18:38,600 --> 00:18:41,920 Speaker 6: probably held up much better what held up as as to. 384 00:18:41,880 --> 00:18:44,000 Speaker 5: Be expected, and and you know, we kind. 385 00:18:43,840 --> 00:18:46,840 Speaker 6: Of saw, you know, some pronounced weakness on the China 386 00:18:46,880 --> 00:18:49,840 Speaker 6: side of things, and again not a surprise because a 387 00:18:49,880 --> 00:18:52,280 Speaker 6: lot of the sell through numbers that had you know, 388 00:18:52,320 --> 00:18:55,720 Speaker 6: come out from China, you know, was looking you know, 389 00:18:56,160 --> 00:18:58,680 Speaker 6: essentially it was kind of pointing towards double digit declines 390 00:18:58,760 --> 00:19:01,560 Speaker 6: out of kind of the eye phone business. So that's 391 00:19:01,680 --> 00:19:04,639 Speaker 6: essentially what you've got. So it's it's pretty brutal, but 392 00:19:05,520 --> 00:19:08,760 Speaker 6: not necessarily a complete surprise given some of the indications 393 00:19:08,800 --> 00:19:10,280 Speaker 6: we got going into the numbers. 394 00:19:10,080 --> 00:19:12,800 Speaker 3: All right, the three bright spots, iPad, MAC, and services. 395 00:19:12,800 --> 00:19:15,240 Speaker 3: The iPad and MAC. The year over year services is 396 00:19:15,280 --> 00:19:19,040 Speaker 3: at an all time record. What's interesting too, all time 397 00:19:19,520 --> 00:19:21,560 Speaker 3: revenue record too as well, one hundred and twenty four 398 00:19:21,560 --> 00:19:25,199 Speaker 3: point three billion and narrowly beating Wall Street estimates. Again, 399 00:19:25,320 --> 00:19:28,040 Speaker 3: a huge miss for China when it comes to Apple 400 00:19:28,119 --> 00:19:31,199 Speaker 3: eighteen point five billion versus twenty one point six billion 401 00:19:31,560 --> 00:19:33,879 Speaker 3: that Wall Street expected, and a big miss for the 402 00:19:33,920 --> 00:19:37,240 Speaker 3: iPhone sixty nine point one billion dollars versus seventy one 403 00:19:37,240 --> 00:19:42,480 Speaker 3: billion dollars expected. And you know, initial reaction Angelo in 404 00:19:42,560 --> 00:19:45,560 Speaker 3: terms of the share price. Initially we saw pop and 405 00:19:45,600 --> 00:19:47,760 Speaker 3: then we saw the stock move down just down to 406 00:19:47,840 --> 00:19:51,880 Speaker 3: here a hare at this point, you know, a lot 407 00:19:51,880 --> 00:19:54,280 Speaker 3: of when we talk about Apple is we are saying 408 00:19:54,320 --> 00:19:57,119 Speaker 3: what's the next big thing? Right and certainly if the 409 00:19:57,200 --> 00:20:01,520 Speaker 3: iPhone is you know, certainly shoring business a still a 410 00:20:01,680 --> 00:20:04,560 Speaker 3: very big business. But maybe some questions about China growth 411 00:20:04,600 --> 00:20:07,240 Speaker 3: going forward. But where do you want to see the 412 00:20:07,280 --> 00:20:10,239 Speaker 3: company move into? Where are the new opportunities in your 413 00:20:10,359 --> 00:20:11,080 Speaker 3: view for Apple. 414 00:20:12,160 --> 00:20:14,680 Speaker 6: Yeah, I mean, listen, I think, you know, we need 415 00:20:14,720 --> 00:20:17,000 Speaker 6: to continue to see good growth on the services side 416 00:20:17,000 --> 00:20:19,440 Speaker 6: of things, and then to continue to innovate and come 417 00:20:19,480 --> 00:20:21,880 Speaker 6: out with new offerings on the services side of things. 418 00:20:22,600 --> 00:20:25,679 Speaker 6: And I think that business will naturally continue to grow 419 00:20:26,040 --> 00:20:28,080 Speaker 6: due to a number of factors. But you know, as 420 00:20:28,119 --> 00:20:29,960 Speaker 6: far as kind of what we're looking for here over 421 00:20:30,000 --> 00:20:32,000 Speaker 6: the next couple of quarters, I don't think you should 422 00:20:32,000 --> 00:20:34,560 Speaker 6: forget about Apple Intelligence. I think that's still a very 423 00:20:34,560 --> 00:20:36,560 Speaker 6: important part of this story. We've kind of seen the 424 00:20:36,600 --> 00:20:40,040 Speaker 6: first two trunches of Apple Intelligence really roll out. The 425 00:20:40,080 --> 00:20:42,080 Speaker 6: first trunch well, you know, was really a non event. 426 00:20:42,320 --> 00:20:44,640 Speaker 6: I actually think, you know, and I have the iPhone sixteen. 427 00:20:44,720 --> 00:20:46,480 Speaker 6: I actually really liked let a number of the other 428 00:20:46,600 --> 00:20:49,199 Speaker 6: upgrades on the second trunch out there. I mean, I 429 00:20:49,280 --> 00:20:52,000 Speaker 6: use kind of visual intelligence all the time. Not crazy 430 00:20:52,000 --> 00:20:54,879 Speaker 6: about gen moji's and what have you, but you know, 431 00:20:55,080 --> 00:20:57,280 Speaker 6: I think there were a number of decent features out there, 432 00:20:57,320 --> 00:21:00,359 Speaker 6: specifically on the visual intelligence ide thinks I think Grounds 433 00:21:00,440 --> 00:21:03,399 Speaker 6: was great. I think the chat, GPT and integration is 434 00:21:03,440 --> 00:21:05,520 Speaker 6: super helpful for someone that just kind of you know, 435 00:21:05,920 --> 00:21:07,879 Speaker 6: looking to do stuff, you know, on the fly on 436 00:21:07,920 --> 00:21:10,520 Speaker 6: their phone. So I just don't think the consumer is 437 00:21:10,520 --> 00:21:13,040 Speaker 6: well aware of it obviously, and we're still at a 438 00:21:13,040 --> 00:21:15,800 Speaker 6: point where you know, most of kind of the installed 439 00:21:15,840 --> 00:21:18,720 Speaker 6: base doesn't have access or even knows about Apple Apple 440 00:21:18,800 --> 00:21:20,840 Speaker 6: Intelligence at this point in time. We'll get kind of 441 00:21:20,840 --> 00:21:24,240 Speaker 6: the the third you know, trunch here in the coming months, 442 00:21:24,280 --> 00:21:26,040 Speaker 6: and I think that's really going to help in terms 443 00:21:26,040 --> 00:21:29,119 Speaker 6: of the serie integration and what Apple can kind of 444 00:21:29,119 --> 00:21:32,040 Speaker 6: demonstrate across kind of the app store and what have you. 445 00:21:32,400 --> 00:21:34,320 Speaker 6: And then you know, clearly, you know, we kind of 446 00:21:34,359 --> 00:21:38,080 Speaker 6: want to see how that reflects across the rest of 447 00:21:38,119 --> 00:21:42,280 Speaker 6: the ecosystem as they kind of throw this out internationally, 448 00:21:42,440 --> 00:21:44,760 Speaker 6: what kind of partnerships they can kind of announce out 449 00:21:44,760 --> 00:21:47,439 Speaker 6: in China. Does that make a difference in China in 450 00:21:47,520 --> 00:21:50,119 Speaker 6: terms of kind of helping the demand outlook, because I 451 00:21:50,160 --> 00:21:52,640 Speaker 6: do think a big problem with with Apple right now 452 00:21:52,680 --> 00:21:54,840 Speaker 6: in China is the fact that they don't have AI 453 00:21:54,960 --> 00:21:58,520 Speaker 6: capabilities where you know, obviously they're they're China peers do 454 00:21:59,280 --> 00:22:02,320 Speaker 6: don't have a full device out there where their peers do. 455 00:22:02,440 --> 00:22:04,600 Speaker 6: And hopefully, you know, we see something on the foldable 456 00:22:04,640 --> 00:22:07,679 Speaker 6: side of things here over the next kind of two years, 457 00:22:07,680 --> 00:22:09,639 Speaker 6: So you know, where I'd like to see them go 458 00:22:09,880 --> 00:22:12,760 Speaker 6: is kind of, you know, start evolving their ecosystem where 459 00:22:12,840 --> 00:22:16,080 Speaker 6: they could find some success, at least in China, because 460 00:22:16,119 --> 00:22:18,160 Speaker 6: at this point in time, you know, what they've got 461 00:22:18,160 --> 00:22:19,960 Speaker 6: in terms of their offering in China is just not 462 00:22:20,000 --> 00:22:20,240 Speaker 6: going to. 463 00:22:20,240 --> 00:22:22,120 Speaker 3: Cut it all right, Going to leave it on that note, 464 00:22:22,160 --> 00:22:25,400 Speaker 3: Angela's you know, he's senior equity analyst at CFR Research 465 00:22:25,480 --> 00:22:27,159 Speaker 3: joining us in New York City. Do you want to 466 00:22:27,200 --> 00:22:31,520 Speaker 3: mention Tim Cook? In the earnings release and the statement 467 00:22:32,040 --> 00:22:35,960 Speaker 3: called it the company's best quarter ever at Apple. He 468 00:22:36,000 --> 00:22:38,840 Speaker 3: also said, through the power of Apple Silicon, we're unlocking 469 00:22:38,840 --> 00:22:42,440 Speaker 3: new possibilities for our users with Apple Intelligence, which makes 470 00:22:42,440 --> 00:22:45,120 Speaker 3: apps and experiences even better and more personal. We're excited 471 00:22:45,119 --> 00:22:47,800 Speaker 3: that Apple Intelligence will be available and even more languages 472 00:22:47,840 --> 00:22:51,640 Speaker 3: this April. So Tim is certainly choosing to highlight that 473 00:22:51,680 --> 00:22:54,320 Speaker 3: we should point out. Apple shares though after an initial 474 00:22:54,400 --> 00:22:58,400 Speaker 3: pop right after the earnings release here in the aftermarket, 475 00:22:58,760 --> 00:22:59,879 Speaker 3: are now pretty much flat. 476 00:23:00,040 --> 00:23:02,280 Speaker 2: Yeah, no mention of China in that statement, which certainly 477 00:23:02,359 --> 00:23:05,920 Speaker 2: will be a focus of investors on that call when 478 00:23:05,920 --> 00:23:08,320 Speaker 2: it does begin in just a few minutes. It's certainly 479 00:23:08,320 --> 00:23:11,800 Speaker 2: a focus for Caroline High. She's a Bloomberg Technology co host. 480 00:23:11,880 --> 00:23:14,240 Speaker 2: She joins us here in the Bloomberg Interactive Brokers studio. 481 00:23:14,960 --> 00:23:18,280 Speaker 2: Two big misses today Caroline highphone revenue coming in about 482 00:23:18,280 --> 00:23:20,520 Speaker 2: two billion dollars shi of estimates, and then greater China 483 00:23:20,520 --> 00:23:23,600 Speaker 2: revenue coming in about three billion dollars shi of estimates. 484 00:23:24,040 --> 00:23:27,199 Speaker 2: Does Apple need to change its strategy in China? Or 485 00:23:27,240 --> 00:23:30,560 Speaker 2: do investors need to adjust their expectations about China? 486 00:23:30,680 --> 00:23:32,480 Speaker 7: Do we need to get more comfortable with their selling 487 00:23:32,680 --> 00:23:35,119 Speaker 7: fewer phones but in a higher average selling price. And 488 00:23:35,200 --> 00:23:38,600 Speaker 7: I think that's perhaps where they're trying to educate people towards. 489 00:23:38,960 --> 00:23:39,520 Speaker 2: Is that in China? 490 00:23:39,640 --> 00:23:40,240 Speaker 5: Is that everywhere? 491 00:23:40,720 --> 00:23:41,280 Speaker 1: Well, I mean it. 492 00:23:41,280 --> 00:23:43,280 Speaker 7: Feels like everywhere, but we do still have the slightly 493 00:23:43,560 --> 00:23:46,399 Speaker 7: cheaper phones that are available in the US, but we 494 00:23:46,480 --> 00:23:49,400 Speaker 7: don't have the rampant sort of competition that you do 495 00:23:49,480 --> 00:23:51,320 Speaker 7: have with a Huawei and with some of the local 496 00:23:51,320 --> 00:23:53,439 Speaker 7: operators that are in China that are just managing to 497 00:23:53,440 --> 00:23:57,600 Speaker 7: produce far more sophisticateated phones and a much lower price point. 498 00:23:57,880 --> 00:24:02,000 Speaker 7: And also there's some national patriotic fervor that's going on 499 00:24:02,040 --> 00:24:04,880 Speaker 7: and wanting to buy your locally made phones. So they 500 00:24:04,960 --> 00:24:08,200 Speaker 7: have been educating us and I think counterpoint research. For example, 501 00:24:08,600 --> 00:24:10,160 Speaker 7: front run the fact that they're going to have had 502 00:24:10,160 --> 00:24:14,520 Speaker 7: a dismal general amount sold eighteen percent rejection they thought 503 00:24:14,560 --> 00:24:17,240 Speaker 7: in terms of phone sold, But if the average selling 504 00:24:17,240 --> 00:24:19,680 Speaker 7: price is picking up, you're not going to be hurting 505 00:24:19,720 --> 00:24:21,960 Speaker 7: quite so bad. But look, ultimately we've seen it's a 506 00:24:22,000 --> 00:24:25,119 Speaker 7: big miss. They're growing in every region outside of China, 507 00:24:25,560 --> 00:24:28,359 Speaker 7: and even the America's Japan was pretty good, but really 508 00:24:28,480 --> 00:24:30,399 Speaker 7: China has been that real weak point, and we have 509 00:24:30,440 --> 00:24:32,080 Speaker 7: to perhaps see that the company is just going to 510 00:24:32,080 --> 00:24:33,719 Speaker 7: try and retrain us to think about them as a 511 00:24:33,760 --> 00:24:38,040 Speaker 7: services company, as an Apple Intelligence company. And look, with 512 00:24:38,080 --> 00:24:40,320 Speaker 7: iPhones missing as well, maybe we have to start to 513 00:24:40,320 --> 00:24:42,200 Speaker 7: think is this really always going to be the juggernaut 514 00:24:42,200 --> 00:24:42,760 Speaker 7: we thought it was? 515 00:24:42,880 --> 00:24:45,399 Speaker 3: What about Apple Intelligence? Right? We have certainly heard so 516 00:24:45,480 --> 00:24:48,280 Speaker 3: much from the company, Tim Cook singling it out also 517 00:24:48,920 --> 00:24:52,199 Speaker 3: on the release and in a statement, So how is 518 00:24:52,200 --> 00:24:55,560 Speaker 3: the world thinking about Apple Intelligence and its opportunities? 519 00:24:55,760 --> 00:24:57,560 Speaker 1: I mean, what what that's far? 520 00:24:58,520 --> 00:25:00,480 Speaker 7: I mean, of course I want to have fun in 521 00:25:00,880 --> 00:25:04,040 Speaker 7: a Gen Moji, but ultimately I'm going to be upgrading 522 00:25:04,080 --> 00:25:06,360 Speaker 7: my phone for that. No, I probably have gone ungraded 523 00:25:06,400 --> 00:25:09,000 Speaker 7: to an iPhone sixteen because my darn camera is broken 524 00:25:09,040 --> 00:25:10,280 Speaker 7: and I want to get a better camera, and I 525 00:25:10,320 --> 00:25:12,200 Speaker 7: want to get a slimmer phone. But I wouldn't have 526 00:25:12,240 --> 00:25:14,480 Speaker 7: gone for it for Apple Intelligence largely because look, I 527 00:25:14,480 --> 00:25:17,320 Speaker 7: can integrate Google and to upgrade there and have it 528 00:25:17,920 --> 00:25:20,240 Speaker 7: magicing my emails and making life a little bit more 529 00:25:20,320 --> 00:25:24,080 Speaker 7: sophisticated there, and compared to Samsung, it is not able 530 00:25:24,119 --> 00:25:27,040 Speaker 7: to innovate in the way that Samsung's adapted to Alphabet's 531 00:25:27,080 --> 00:25:29,840 Speaker 7: offering Open Ai. Though, I think the winning formula for 532 00:25:29,880 --> 00:25:33,680 Speaker 7: Apple Intelligence going forward is that it hasn't spent billions 533 00:25:33,720 --> 00:25:35,760 Speaker 7: on its own large language model. It's gone in bed 534 00:25:35,760 --> 00:25:37,720 Speaker 7: with open Ai, and open Ai is probably gonna have 535 00:25:37,720 --> 00:25:40,399 Speaker 7: to get a lot cheaper because of what's happening with Deeze. 536 00:25:40,800 --> 00:25:42,880 Speaker 2: Caroline h Have you been watching Severance? 537 00:25:43,960 --> 00:25:44,080 Speaker 4: No? 538 00:25:44,160 --> 00:25:44,679 Speaker 1: I haven't. 539 00:25:44,880 --> 00:25:46,800 Speaker 5: Okay, Well, I'm. 540 00:25:46,680 --> 00:25:48,480 Speaker 1: Too busy on the jacket, holl the day of the Jackal. 541 00:25:48,720 --> 00:25:53,199 Speaker 2: It's it's a huge investment by Apple, huge marketing, push 542 00:25:53,640 --> 00:25:57,000 Speaker 2: services revenue a bright spot for the company. Yes, coming 543 00:25:57,000 --> 00:26:00,200 Speaker 2: in at twenty six point three four billion dollars, it's 544 00:26:00,200 --> 00:26:02,800 Speaker 2: for twenty six point one billion. I bring up Severance 545 00:26:02,840 --> 00:26:06,840 Speaker 2: because that's part of the services category. This is a 546 00:26:06,920 --> 00:26:11,919 Speaker 2: high margin business for Apple, the services social TVs TVs. 547 00:26:11,960 --> 00:26:17,080 Speaker 2: But the services category. Yeah, does does services growth and 548 00:26:17,160 --> 00:26:21,520 Speaker 2: strength ever offset weakness in China or for MyPhone? Well? 549 00:26:21,560 --> 00:26:23,720 Speaker 7: I think it's interesting. Then the new COFO who has 550 00:26:23,800 --> 00:26:26,120 Speaker 7: just taken on the role. He's a long time Apple executive, 551 00:26:26,160 --> 00:26:28,320 Speaker 7: but he's just taken on the role in January, is 552 00:26:28,320 --> 00:26:31,680 Speaker 7: really talking up about sort of the installed base, because 553 00:26:31,720 --> 00:26:33,879 Speaker 7: that's where they want you to think the amount of 554 00:26:34,920 --> 00:26:38,159 Speaker 7: max iPads phones that we all own. They say that 555 00:26:38,160 --> 00:26:40,320 Speaker 7: we now have an installed base of active devices that 556 00:26:40,400 --> 00:26:43,480 Speaker 7: reached an all time high across all products and geographic segments. 557 00:26:43,640 --> 00:26:47,120 Speaker 7: Suddenly the services bigot wheel just flies. And then when 558 00:26:47,119 --> 00:26:50,280 Speaker 7: you're getting into payments, when you're getting into interoperability, of course, 559 00:26:50,320 --> 00:26:52,880 Speaker 7: services just becomes ever more necessary. 560 00:26:52,480 --> 00:26:55,520 Speaker 2: For I mean, I probably pay Apple more each year 561 00:26:55,800 --> 00:26:58,280 Speaker 2: between between the memory. 562 00:26:59,520 --> 00:27:01,200 Speaker 1: Yeah, what about the app store? 563 00:27:01,240 --> 00:27:04,560 Speaker 7: I do wonder with some regulatory perspective, we heard it 564 00:27:04,600 --> 00:27:07,360 Speaker 7: from Microsoft yesterday, Well was it Meta yesterday talk. 565 00:27:07,200 --> 00:27:08,040 Speaker 1: Singling out EU. 566 00:27:08,200 --> 00:27:09,840 Speaker 7: But how much are they going to have to change 567 00:27:09,840 --> 00:27:11,399 Speaker 7: the business model when it comes to the revenue They 568 00:27:11,440 --> 00:27:13,480 Speaker 7: can just skim away from an app store when it 569 00:27:13,520 --> 00:27:16,280 Speaker 7: think about how it's treating its own consumers and whether 570 00:27:16,320 --> 00:27:18,040 Speaker 7: we're being fairly treated across the world. 571 00:27:18,119 --> 00:27:19,280 Speaker 3: I mean, what do you want to know and what 572 00:27:19,280 --> 00:27:20,159 Speaker 3: do you want to hear from them? 573 00:27:20,200 --> 00:27:20,600 Speaker 1: On the car? 574 00:27:20,800 --> 00:27:22,440 Speaker 3: Is it just China or is it other things? 575 00:27:23,280 --> 00:27:25,800 Speaker 1: I think, what is your next big innovation? Is it 576 00:27:25,840 --> 00:27:26,600 Speaker 1: about the home? 577 00:27:26,840 --> 00:27:29,720 Speaker 7: Because look, the Vision Pro looks cute, but are we 578 00:27:29,800 --> 00:27:32,600 Speaker 7: all spending thousands on it? No, it hasn't been the 579 00:27:32,760 --> 00:27:35,240 Speaker 7: R and D winner for them this yet, but it 580 00:27:35,359 --> 00:27:37,600 Speaker 7: might have spin offs when they can tell about how 581 00:27:37,680 --> 00:27:39,880 Speaker 7: much they've iterated there to bring it to what they're 582 00:27:39,880 --> 00:27:42,200 Speaker 7: going to do with the home, the video screens, the robotics. 583 00:27:42,240 --> 00:27:44,439 Speaker 7: We're going to see how they can become evanmore integrale. 584 00:27:44,520 --> 00:27:47,400 Speaker 7: We need another winning product. It wasn't cars, the Vision Pro, 585 00:27:47,560 --> 00:27:50,320 Speaker 7: not yet, But what about twenty twenty five is some 586 00:27:50,400 --> 00:27:51,520 Speaker 7: new unleashed hardware. 587 00:27:51,560 --> 00:27:53,600 Speaker 3: I'm amazer not more entrenched in the home. I mean, 588 00:27:53,640 --> 00:27:56,040 Speaker 3: I know in my home it's such an Apple household, 589 00:27:56,080 --> 00:27:56,639 Speaker 3: but it's not. 590 00:27:57,040 --> 00:27:59,080 Speaker 1: We're a Google home household. 591 00:27:59,240 --> 00:28:01,160 Speaker 3: We are too. We are too, and so I'm kind 592 00:28:01,160 --> 00:28:02,880 Speaker 3: of amazed that they have kind of waited so long 593 00:28:02,920 --> 00:28:04,159 Speaker 3: to get into the home market. 594 00:28:04,280 --> 00:28:06,760 Speaker 2: Yeah, it would be certainly that would be an interesting 595 00:28:06,760 --> 00:28:09,320 Speaker 2: product category from them. What about something more akin to 596 00:28:09,800 --> 00:28:12,679 Speaker 2: metas glasses that we spoke about yesterday, and if they 597 00:28:12,720 --> 00:28:15,600 Speaker 2: were to come out with something that is less vision 598 00:28:15,680 --> 00:28:19,359 Speaker 2: pro oculous and more sort of like low profile Rabia, 599 00:28:19,359 --> 00:28:19,800 Speaker 2: because that. 600 00:28:19,800 --> 00:28:20,840 Speaker 1: Was the irritation for many. 601 00:28:20,960 --> 00:28:23,439 Speaker 7: Was it the fact that you've basically got a huge battery, 602 00:28:23,480 --> 00:28:24,720 Speaker 7: we connected to you and it just. 603 00:28:24,680 --> 00:28:25,760 Speaker 1: So harding around. 604 00:28:27,119 --> 00:28:29,840 Speaker 7: The tried and tested formula of Apple is let everyone 605 00:28:29,840 --> 00:28:32,320 Speaker 7: else play and then you come in and win the 606 00:28:32,400 --> 00:28:34,840 Speaker 7: day with something beautiful sneak and everyone jumps on board. 607 00:28:34,880 --> 00:28:36,760 Speaker 7: So maybe that is the winning formula for the home 608 00:28:36,800 --> 00:28:38,920 Speaker 7: and when it will be for glasses and they'll start 609 00:28:38,920 --> 00:28:39,400 Speaker 7: to dabble in. 610 00:28:39,480 --> 00:28:40,960 Speaker 1: I mean, Tim Cook's got nice pair of glasses. 611 00:28:41,000 --> 00:28:42,920 Speaker 7: I wonder if he wants to start making them and 612 00:28:43,360 --> 00:28:46,400 Speaker 7: we suit you down to the ground, Tim, But I 613 00:28:46,440 --> 00:28:48,280 Speaker 7: do think that they do. They're always going to be 614 00:28:48,320 --> 00:28:50,640 Speaker 7: slightly slower off the mark. Then come and bring in 615 00:28:50,720 --> 00:28:52,600 Speaker 7: what it. They haven't got a foldable phone yet. Look, 616 00:28:52,640 --> 00:28:56,280 Speaker 7: Samsung has plenty on the market. Everyone's been wanting to 617 00:28:56,320 --> 00:28:58,880 Speaker 7: get a smaller form factor. They're just waiting until they 618 00:28:58,880 --> 00:29:01,040 Speaker 7: can perfect. So you don't get a crease in it. 619 00:29:01,080 --> 00:29:02,720 Speaker 7: So I do wonder whether it's gonna take a little 620 00:29:02,720 --> 00:29:03,160 Speaker 7: bit of time. 621 00:29:03,320 --> 00:29:05,840 Speaker 3: You know, we have talked with Mark I guess about 622 00:29:05,880 --> 00:29:08,560 Speaker 3: just how the overall market here in the United States 623 00:29:08,600 --> 00:29:10,960 Speaker 3: is so overweighted to some of these big tech companies. 624 00:29:11,000 --> 00:29:14,200 Speaker 3: And I am curious though they are important, right when 625 00:29:14,240 --> 00:29:16,560 Speaker 3: you look at kind of the numbers that they bring in, 626 00:29:16,760 --> 00:29:19,360 Speaker 3: how twenty four million, I mean, it's just extraordinary, even 627 00:29:19,440 --> 00:29:22,400 Speaker 3: when we say right, maybe right, it's extraordinary. So how 628 00:29:22,440 --> 00:29:25,320 Speaker 3: are you thinking about this week of some of these 629 00:29:25,360 --> 00:29:27,440 Speaker 3: big tech names and the results that we've had. 630 00:29:28,280 --> 00:29:31,800 Speaker 7: Thing they've done all right, considering Monday and the deep 631 00:29:31,840 --> 00:29:35,480 Speaker 7: seeky whiplash that we had, and I thought the spend. 632 00:29:35,160 --> 00:29:37,320 Speaker 1: Would be so much more under consideration. 633 00:29:37,440 --> 00:29:40,680 Speaker 7: But I think Satia, even though Microsoft saw a big 634 00:29:40,760 --> 00:29:43,480 Speaker 7: hit today, Satia managed to sort of thread the needle 635 00:29:43,480 --> 00:29:47,360 Speaker 7: that look, we're already offering our one on on our foundry, 636 00:29:47,400 --> 00:29:50,400 Speaker 7: IAI foundry, come to us find the best models. We'll 637 00:29:50,400 --> 00:29:52,880 Speaker 7: also be able to we have our issue as supply, 638 00:29:52,960 --> 00:29:54,840 Speaker 7: we've got to continue to invest. So they managed to 639 00:29:54,920 --> 00:29:58,440 Speaker 7: vindicate a spending. I think Meta did a phenomenal job 640 00:29:58,440 --> 00:30:04,560 Speaker 7: of just talking up with such pompous, like grandiose ideas that. 641 00:30:04,600 --> 00:30:05,400 Speaker 1: Won everyone over. 642 00:30:05,640 --> 00:30:07,800 Speaker 7: You know, musted the same, the fact that actually the 643 00:30:07,880 --> 00:30:11,040 Speaker 7: numbers look pretty ugly. But he's so optimistic about Optimist, 644 00:30:11,040 --> 00:30:14,240 Speaker 7: he's so optimistic about FSD that we managed to be 645 00:30:14,280 --> 00:30:16,760 Speaker 7: blindsided by the idea that actually the plans are there, 646 00:30:16,800 --> 00:30:18,760 Speaker 7: the money is being well spent, and we're still committed 647 00:30:18,800 --> 00:30:21,560 Speaker 7: to these companies. So ultimately, I think they've managed to 648 00:30:21,680 --> 00:30:24,320 Speaker 7: navigate a pretty rocky period Apple. The fact that it's 649 00:30:24,320 --> 00:30:27,040 Speaker 7: flat Microsoft's been really the only real pain point here. 650 00:30:27,160 --> 00:30:29,800 Speaker 7: St Micro had another problem ever in Europe as well. 651 00:30:30,040 --> 00:30:32,240 Speaker 7: I look towards Alphabet and Amazon. Can they vindicate the 652 00:30:32,240 --> 00:30:33,560 Speaker 7: amounts of money that they're going to have to save. 653 00:30:33,640 --> 00:30:35,200 Speaker 2: I'm not going to put words in Mark Umman's mouth, 654 00:30:35,240 --> 00:30:36,840 Speaker 2: but he spent plenty of time over the last few 655 00:30:36,840 --> 00:30:40,600 Speaker 2: months on our program really criticizing Apple for. 656 00:30:40,560 --> 00:30:42,120 Speaker 1: Its AI is and it's analysts. 657 00:30:42,160 --> 00:30:48,280 Speaker 7: He loves to criticize the analyst. 658 00:30:45,840 --> 00:30:48,800 Speaker 2: AI and you know, a question about slow rolling AI 659 00:30:48,960 --> 00:30:52,640 Speaker 2: and to what extent this actually is something that's not 660 00:30:52,680 --> 00:30:56,680 Speaker 2: just incremental but is actually meaningful. When do we start 661 00:30:56,680 --> 00:30:59,600 Speaker 2: to see Apple intelligence really flourish. 662 00:30:59,720 --> 00:31:03,200 Speaker 7: I think they're signaling it signaling in the even the 663 00:31:03,240 --> 00:31:05,840 Speaker 7: press release saying that more languages are coming in April, 664 00:31:06,320 --> 00:31:10,680 Speaker 7: we will be making it further integrated. It's also interesting 665 00:31:10,720 --> 00:31:12,760 Speaker 7: when they bring these things without us even knowing, like 666 00:31:12,800 --> 00:31:15,520 Speaker 7: the news that they brought starlink and the fact that 667 00:31:15,600 --> 00:31:17,800 Speaker 7: we can now use with it, they just hide in 668 00:31:17,840 --> 00:31:19,600 Speaker 7: these little operating system grades. 669 00:31:21,040 --> 00:31:23,600 Speaker 2: So example, publicly acknowledge that, I know Mark Grimman reported 670 00:31:23,600 --> 00:31:23,880 Speaker 2: that it was. 671 00:31:23,840 --> 00:31:24,360 Speaker 5: Going to happen. 672 00:31:24,360 --> 00:31:26,760 Speaker 7: I think T Mobile CEO came on and talked about it, 673 00:31:26,800 --> 00:31:29,360 Speaker 7: and it's just that ultimately they do slow roll. They 674 00:31:29,360 --> 00:31:32,120 Speaker 7: don't perhaps they realize that they need to speak to 675 00:31:32,160 --> 00:31:33,080 Speaker 7: the investor. 676 00:31:32,720 --> 00:31:33,840 Speaker 1: Base about intelligence. 677 00:31:33,880 --> 00:31:36,040 Speaker 7: They're going to talk about how they're really managing to 678 00:31:36,040 --> 00:31:39,840 Speaker 7: infuse it in a more seamless manner. But to you 679 00:31:39,920 --> 00:31:41,520 Speaker 7: and I as a consumer, I think they just don't 680 00:31:41,520 --> 00:31:43,160 Speaker 7: want to stress test it too much. They want to 681 00:31:43,200 --> 00:31:46,680 Speaker 7: slowly have us naturally absorbing it and making our life 682 00:31:46,720 --> 00:31:49,920 Speaker 7: simpler and simpler. But thus far, like a little summari 683 00:31:50,080 --> 00:31:52,720 Speaker 7: of my email hasn't changed my life. 684 00:31:52,560 --> 00:31:53,080 Speaker 5: All that much. 685 00:31:53,200 --> 00:31:56,120 Speaker 3: Yeah, exactly. I just want to remind everybody that we 686 00:31:56,160 --> 00:32:00,360 Speaker 3: do see Apple shares fluctuating in the aftermarket. Apple as 687 00:32:00,360 --> 00:32:02,960 Speaker 3: our Mark German Reports posted sales that were slightly better 688 00:32:02,960 --> 00:32:05,600 Speaker 3: than analysts estimated, even as the iPhone and sales in 689 00:32:05,680 --> 00:32:10,080 Speaker 3: China were weaker than anticipated. Caroline, just talking about that 690 00:32:10,120 --> 00:32:13,000 Speaker 3: revenue number, it did rise four percent to one hundred 691 00:32:13,040 --> 00:32:15,560 Speaker 3: and twenty four point three billion in the fiscal first quarter. 692 00:32:16,320 --> 00:32:18,920 Speaker 3: Analysts had estimated one hundred and twenty four point one, so, 693 00:32:19,320 --> 00:32:21,640 Speaker 3: you know, coming in just a hair better than what 694 00:32:21,800 --> 00:32:25,600 Speaker 3: the street was forecasting. But again concerns over China and 695 00:32:25,680 --> 00:32:29,400 Speaker 3: Apples struggling there stacks up about four tenths of a 696 00:32:29,480 --> 00:32:34,040 Speaker 3: percent here in the aftermarket. Yeah, I just think, you know, 697 00:32:34,080 --> 00:32:36,800 Speaker 3: it's interesting to see after what a crazy week that 698 00:32:36,840 --> 00:32:39,840 Speaker 3: we've seen. I feel like with technology that the stock 699 00:32:39,960 --> 00:32:40,840 Speaker 3: is just kind of flat. 700 00:32:40,960 --> 00:32:43,640 Speaker 7: Yeah, we priced it in, and remember great point, it 701 00:32:43,720 --> 00:32:46,760 Speaker 7: was kind of beaten up running into this. We'd had 702 00:32:46,840 --> 00:32:50,080 Speaker 7: five analyst downgrades right in the last month or so, 703 00:32:50,400 --> 00:32:53,320 Speaker 7: and unlike in Nvidia that has zero cells, there have 704 00:32:53,400 --> 00:32:55,320 Speaker 7: been a few creeping into Apples, So I think people 705 00:32:55,320 --> 00:32:57,600 Speaker 7: had started to price in the China weakness. 706 00:32:57,600 --> 00:32:59,200 Speaker 1: Interestingly made the point to. 707 00:32:59,320 --> 00:33:02,480 Speaker 7: Like all the going to sell us cheaper price points 708 00:33:03,040 --> 00:33:05,320 Speaker 7: they are, according to Mark Gumman, going to be focusing 709 00:33:05,400 --> 00:33:07,800 Speaker 7: on the iPhone SE, which is the cheaper around five 710 00:33:07,880 --> 00:33:10,600 Speaker 7: hundred dollars offering that's going to come in April March. 711 00:33:10,720 --> 00:33:13,120 Speaker 7: Maybe that's going to pull more people perhaps away from 712 00:33:13,160 --> 00:33:15,880 Speaker 7: the Samsung's and the Android offerings. Maybe we get the cheaper, 713 00:33:15,880 --> 00:33:19,040 Speaker 7: lower end Airpod's making a dent. But all of this 714 00:33:19,080 --> 00:33:21,360 Speaker 7: I think had just been guided. We knew that Apple 715 00:33:22,000 --> 00:33:24,600 Speaker 7: was going to have a terrible time in China, and 716 00:33:24,680 --> 00:33:27,200 Speaker 7: Apple Intelligences isn't there yet, and people have really been 717 00:33:27,240 --> 00:33:32,560 Speaker 7: complaining about the latest os, like use cases, the way 718 00:33:32,560 --> 00:33:34,520 Speaker 7: in which the phone just doesn't feel as slick. 719 00:33:34,280 --> 00:33:34,800 Speaker 1: As it used to. 720 00:33:35,480 --> 00:33:39,160 Speaker 2: Are we going to start hearing more chatter about Tim 721 00:33:39,200 --> 00:33:41,720 Speaker 2: Cook and a succession plan. We've been talking a lot 722 00:33:41,720 --> 00:33:44,680 Speaker 2: about Intel and what Intel does post Gal Singer, and. 723 00:33:44,600 --> 00:33:46,040 Speaker 1: They've got some big issues they do. 724 00:33:47,200 --> 00:33:49,120 Speaker 2: Tim Cook has been an Apple since nineteen ninety eight, 725 00:33:49,120 --> 00:33:50,880 Speaker 2: he's been CEO since twenty eleven. 726 00:33:51,240 --> 00:33:52,320 Speaker 5: What's the succession plan? 727 00:33:52,560 --> 00:33:54,880 Speaker 7: And they've just had a CFO come into the MITS 728 00:33:54,920 --> 00:33:57,720 Speaker 7: who's been trained up from within. I don't think anyone 729 00:33:57,760 --> 00:34:00,520 Speaker 7: feels that Tim's going anywhere soon. He navigates the first 730 00:34:00,520 --> 00:34:05,960 Speaker 7: Trump administration so swiftly and seamlessly worked well to be 731 00:34:05,960 --> 00:34:08,120 Speaker 7: able to protect his business that of course is so 732 00:34:08,200 --> 00:34:10,799 Speaker 7: dependent on China, not just from a selling perspective, but 733 00:34:10,840 --> 00:34:13,640 Speaker 7: it's more from a production perspective. What do tarifs mean 734 00:34:13,680 --> 00:34:15,919 Speaker 7: for him? So I think in this next administration can't 735 00:34:16,640 --> 00:34:18,919 Speaker 7: I wouldn't ever bet that he's going to hand over 736 00:34:19,120 --> 00:34:21,120 Speaker 7: the baton anytime soon. But I think that is a 737 00:34:21,200 --> 00:34:23,000 Speaker 7: key question that people are gonna be asking who from 738 00:34:23,000 --> 00:34:24,480 Speaker 7: within has been groomed up, because. 739 00:34:24,280 --> 00:34:25,799 Speaker 1: Remember they lost a lot of talent as well. 740 00:34:25,880 --> 00:34:27,759 Speaker 7: Johnny E's left, and a lot of people seem to 741 00:34:27,760 --> 00:34:30,040 Speaker 7: move from the engineering the product development side of things. 742 00:34:30,280 --> 00:34:33,759 Speaker 3: All right, fascinating stuff, Caroline, thank you again. Second day 743 00:34:33,800 --> 00:34:36,880 Speaker 3: like making anyways sense of all the big tech earnings. 744 00:34:36,960 --> 00:34:39,680 Speaker 3: As we said, Caroline Hyde is co host of Bloomberg 745 00:34:39,719 --> 00:34:43,239 Speaker 3: Technology on Bloomberg TV. Catch It. They'll continue coverage of 746 00:34:43,280 --> 00:34:45,200 Speaker 3: all the earnings this week. That'll be at eleven am 747 00:34:45,200 --> 00:34:48,160 Speaker 3: Wall Street time tomorrow on Bloomberg TV. Right now, tim 748 00:34:48,200 --> 00:34:50,360 Speaker 3: Apple shares just down about one quarter of one percent.