WEBVTT - Instant Reaction: Apple Names John Ternus Next CEO, Tim Cook Becomes Chairman

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<v Speaker 1>Bloomberg Audio Studios, Podcasts, radio News.

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<v Speaker 2>This is a breaking news update from Bloomberg.

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<v Speaker 3>Instant reaction and analysis from our three thousand journalists and

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<v Speaker 3>analysts around the world.

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<v Speaker 1>John Turnas has been named CEO of Apple and Tim

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<v Speaker 1>Cook named executive chair.

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<v Speaker 4>I'm going right to the press release from the company

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<v Speaker 4>Apple announcing that Tim Cook will become executive chairman of

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<v Speaker 4>Apple's Board of Directors and John Turnas, Senior VP of

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<v Speaker 4>Hardware Engineering, will become Apple's next chief executive officer, effective

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<v Speaker 4>on September one, twenty twenty six, so that's later this year. Transition,

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<v Speaker 4>which was approved unanimously by the Board of Directors, follows

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<v Speaker 4>a thoughtful long term succession planning process Tim Cook continuing

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<v Speaker 4>Tim in his role as CEO through the summer as

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<v Speaker 4>he works closely with Turnus on a smooth transition. As

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<v Speaker 4>executive chairman, Cook will assist with certain aspects of the company,

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<v Speaker 4>including engaging with policymakers around the world. We have talked

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<v Speaker 4>certainly with our mark germat Good at that about the

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<v Speaker 4>role that Tim Cook has played with this white house,

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<v Speaker 4>but really with global leaders and guiding this company.

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<v Speaker 1>Yeah, huge news in the world of Apple, the world

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<v Speaker 1>of technology the world of American companies and global companies.

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<v Speaker 1>Apple has named Tim Cook executive chairman John Turnis as CEO.

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<v Speaker 1>Turnus will join the board of directors, also effective on

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<v Speaker 1>September first, Tim Cook will be executive chair. Tim Cook

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<v Speaker 1>will remain CEO of Apple through September first through the summer.

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<v Speaker 1>John Turnis will become CEO on September first. I want

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<v Speaker 1>to bring in Bloomberg News Senior executive editor for Global Technology,

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<v Speaker 1>Tom Giles. Tom joins us from New York. Hey, Tom,

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<v Speaker 1>just your reaction to I think what a lot of

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<v Speaker 1>people are surprised by the timing.

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<v Speaker 3>Well, it wasn't clear that it was going to happen

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<v Speaker 3>this quickly when we last wrote on this. As you

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<v Speaker 3>mentioned in the Big Take, there was a sense Tim

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<v Speaker 3>Cook has been rather coy about this. How quickly is

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<v Speaker 3>it going to happen? We knew that Turnus was the

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<v Speaker 3>air apparent, We just didn't know how quickly it was

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<v Speaker 3>going to happen. But look, Tim Cook has turned sixty

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<v Speaker 3>sixty five. He has had a great run in many

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<v Speaker 3>respects at Apple. Yes, we've talked a lot about the

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<v Speaker 3>fact that they are not as far along in the use.

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<v Speaker 2>Of AI as they would like to be, as they

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<v Speaker 2>should be.

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<v Speaker 3>Frankly, given who they are that said, he is the

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<v Speaker 3>person he took the baton from Steve Jobs. He was

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<v Speaker 3>remains operationally supply chain wise, a genius in terms of

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<v Speaker 3>making sure that Apple has the components that it needs

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<v Speaker 3>at the exact moment that it needs them. He is

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<v Speaker 3>the one who has been really the many years behind

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<v Speaker 3>the scenes before coming to the to the forefront of

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<v Speaker 3>really enabling Apple to be as successful as it has been.

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<v Speaker 3>If you don't have the supply chain down, it's really

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<v Speaker 3>hard to create those those devices with the margins that

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<v Speaker 3>they that they have and as timely a manner as

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<v Speaker 3>they as they are. You know, it's been a rough

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<v Speaker 3>few years for Apple in some respects with regard to

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<v Speaker 3>you know, we've talked about their car efforts that went

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<v Speaker 3>to know where, we talked about their TV efforts and AI.

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<v Speaker 3>So there have been these moments over the last several

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<v Speaker 3>years of like, well, where's that next killer product going

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<v Speaker 3>to come from? He has he has led them into

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<v Speaker 3>lots of new and really interesting areas in terms of media,

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<v Speaker 3>in terms of in terms of air pods, there is

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<v Speaker 3>a lot of really interesting new stuff going on there,

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<v Speaker 3>but not the.

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<v Speaker 2>Stuff that really grabs everybody's head, the headline.

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<v Speaker 1>But Tom all that to say, there's no indication that

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<v Speaker 1>this was something that the board pushed for at this point.

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<v Speaker 1>This was you know, on Tim Cook's own accord, at

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<v Speaker 1>this point.

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<v Speaker 3>There's no indication. Yeah, there's no indication of anything along

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<v Speaker 3>those lines. I mean, this is something that is being

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<v Speaker 3>seen as orderly.

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<v Speaker 2>There's a little bit.

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<v Speaker 3>Of a tickdown stock last I checked in late trading.

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<v Speaker 3>But I mean, anybody who's been following Apple, anybody who's

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<v Speaker 3>been reading ARC would know this was coming. They would

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<v Speaker 3>know that Turnus was the person who has the confidence

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<v Speaker 3>of Tim Cook and the confidence of the board. You know,

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<v Speaker 3>he spent half his life at Apple. He was he

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<v Speaker 3>worked on computer monitors, product designed for the iPad, took

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<v Speaker 3>over development of the Mac. He's since he's the head

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<v Speaker 3>of engineering, hardware engineering since twenty twenty one. Expansion in

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<v Speaker 3>the product lineup, functional improvement on products, things like bat

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<v Speaker 3>very live performance connectivity. Those sound really nerdy, but they're

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<v Speaker 3>hugely important to consumers and users of Apple's products. And

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<v Speaker 3>you've seen him start to take on a bigger and

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<v Speaker 3>more public role at Apple in recent months. Definitely there

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<v Speaker 3>were signs that this was in the offing.

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<v Speaker 4>Yeah, I mean, yeah, go ahead, no, no, no, please

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<v Speaker 4>go Well, I.

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<v Speaker 2>Was just going to make the point that too. You know, Tim,

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<v Speaker 2>Tim Cook is leaving.

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<v Speaker 3>At A at a an actually pretty good time. When

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<v Speaker 3>you look at the stock price over multiple years, you know,

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<v Speaker 3>it's it's down off the high reached in December, but

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<v Speaker 3>it's it's it's hovering pretty close to that. So this

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<v Speaker 3>is someone who has had the confidence of the investor

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<v Speaker 3>community as a general rule over you know, of a

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<v Speaker 3>very long tenure at Apple.

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<v Speaker 4>But to this point, you know, Turnus has really stepped up.

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<v Speaker 4>As Mark reported in his story about the air apparent

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<v Speaker 4>or possible air apparent, he named turnas you know he

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<v Speaker 4>talked about when Apple held that event in New York

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<v Speaker 4>earlier in March to announce the MacBook Neo. It was

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<v Speaker 4>Turna's not Cook who did the big reveal, right, and

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<v Speaker 4>he was on GMA Good Morning America. So he definitely

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<v Speaker 4>has been taking a step forward here, Tom.

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<v Speaker 3>Yeah, exactly. And they've been expanding his portfolio as well.

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<v Speaker 3>Last year got control of that secretive unit developing robots.

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<v Speaker 3>It's that's actually slated for release as early as next year.

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<v Speaker 3>He's taking a bigger role in product marketing, as we've

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<v Speaker 3>talked about, even to the point of editing copy for

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<v Speaker 3>the website as one of the anecdotes that Mark got

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<v Speaker 3>into his story. So his his profile has been rising,

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<v Speaker 3>his portfolio has been broadening, and and now he's you know,

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<v Speaker 3>he's going to be the guy starting in a few months.

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<v Speaker 1>Carol, I just want to say I'm doing a little

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<v Speaker 1>bit of back of the envelope terminal math here going

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<v Speaker 1>back to January of twenty eleven.

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<v Speaker 4>It looks like a pretty nice chart.

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<v Speaker 5>It is.

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<v Speaker 1>I mean, if you're yeah, if you're a shareholder of Apple,

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<v Speaker 1>since then, you're pretty happy. Shares of Apple up more

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<v Speaker 1>than twenty two hundred percent just since then, the S

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<v Speaker 1>and P five hundred up four hundred and sixty five percent.

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<v Speaker 1>So on an annual basis, the Apple since Tim Cooke

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<v Speaker 1>took over Seer was announced as interim CEO was is

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<v Speaker 1>up twenty four point four percent and annualized, okay, versus

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<v Speaker 1>the S and P five hundred fourteen percent.

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<v Speaker 4>Well on that, and we're showing that right now for

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<v Speaker 4>those who are watching on YouTube and Bloomberg originals.

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<v Speaker 2>Tom.

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<v Speaker 4>You know, the thing is in the press release, as

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<v Speaker 4>Tim and I have gone through it, it did say

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<v Speaker 4>that Tim Cook will become executive chairman of Apple's board

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<v Speaker 4>of directors. He's going to assist with certain aspects of

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<v Speaker 4>the company, including engaging with policy makers around the world,

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<v Speaker 4>and I think about that share price and move up.

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<v Speaker 4>The Apple supply chain is renowned, and as you said,

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<v Speaker 4>Tim Cook is the guy who knows this, but he's

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<v Speaker 4>had to negotiate with some leaders, whether it's over in

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<v Speaker 4>China where they have such a big footprint and then

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<v Speaker 4>as they've been pivoting to India and elsewhere, but then

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<v Speaker 4>also dealing with a very complicated and sometimes difficult White

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<v Speaker 4>House and administration where you don't want to be on

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<v Speaker 4>the wrong side of the president and his team. And

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<v Speaker 4>Tim Cook has done this, I think many would say flawlessly,

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<v Speaker 4>really really well. So having him in that position is

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<v Speaker 4>an important one.

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<v Speaker 3>You need somebody who can play a very diplomatic role

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<v Speaker 3>on a global stage, and who better than Tim Cook,

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<v Speaker 3>the guy who's been there for so long and has

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<v Speaker 3>really been playing that role. As you said, you know,

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<v Speaker 3>it's there's a delicate, delicate dance between Silicon Valley and

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<v Speaker 3>the White House.

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<v Speaker 2>Tim Cook has you know, demonstrated.

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<v Speaker 3>That he has the ear of the president and knows

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<v Speaker 3>how to speak in a language that appeals to Donald Trump.

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<v Speaker 3>He gave him what was the.

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<v Speaker 5>Big golden iPhone?

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<v Speaker 1>Is that what it was?

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<v Speaker 2>Ihone?

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<v Speaker 3>You know, at a at a at a at at

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<v Speaker 3>an event at the White House. I mean, you know,

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<v Speaker 3>I think that every every big, every big tech ceo

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<v Speaker 3>has had to learn how.

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<v Speaker 4>To It was a glass sculpture with a twenty four

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<v Speaker 4>carrat goal base because I think the glass was the glass?

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<v Speaker 4>Was it an iPhone that they maybe use in in

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<v Speaker 4>their products Apple?

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<v Speaker 3>The point, the point being that you know, it's whether

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<v Speaker 3>it's flattery, whatever it is that you know, you need

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<v Speaker 3>to you need to know how to speak the language kiss, throing,

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<v Speaker 3>whatever metaphor you want to use. As you said, he's

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<v Speaker 3>also there's a very delicate balance that he's had to

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<v Speaker 3>strike with regard to China and India. As we saw

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<v Speaker 3>first during the pandemic and then as the the trade

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<v Speaker 3>war really burst onto the scene in the last several years.

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<v Speaker 3>The we've learned the risks of overdependence on one particular

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<v Speaker 3>area of the world.

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<v Speaker 2>For your supply chain.

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<v Speaker 3>So Tim Cook has had to navigate and you know,

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<v Speaker 3>depend more on India war manufacturing more production there, and

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<v Speaker 3>at the same time not go so swiftly, so quickly

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<v Speaker 3>and recklessly that you alienate China, which remains a big

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<v Speaker 3>important market. Now there's also a great deal of competition,

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<v Speaker 3>and competition has been really rising in China for the

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<v Speaker 3>iPhone over the last several years. And you've seen this

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<v Speaker 3>whole bunch of new uh manufacturers there, Apo, Vivo, Huawei

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<v Speaker 3>all becoming increasingly important competitors there. But at the same time,

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<v Speaker 3>iPhone is still popular and in many aspects and many

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<v Speaker 3>parts of the country, and and so you you don't

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<v Speaker 3>want to do something that's going to alienate the Chinese.

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<v Speaker 3>At the same time, you have to diversify your supply chain.

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<v Speaker 3>And that's something that Tim Cook has been doing and

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<v Speaker 3>you know, it's it's it's it's a juggling act and

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<v Speaker 3>he'll he'll be able to continue to do that in

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<v Speaker 3>his new role as executive chairman.

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<v Speaker 1>I want to bring in man Deep Singh Thunk.

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<v Speaker 4>Yeah, I know it's feeling kind of mellow today as

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<v Speaker 4>we waited for more on the war and then bam, he's.

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<v Speaker 1>Global tech research head at Bloomberg Intelligence. I think you know,

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<v Speaker 1>none of us who've been following this or speaking to

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<v Speaker 1>Mark Kerma and reading Mark's reporting is surprised by John

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<v Speaker 1>turnas we know him. Thanks to Mark's reporting, I think

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<v Speaker 1>what we're surprised about is the timing here. What's your reaction.

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<v Speaker 5>Look, I think it was inevitable that there would have been,

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<v Speaker 5>you know, some sort of succession at Apple, and to

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<v Speaker 5>my mind, appointing the hardware chief as the next CEO

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<v Speaker 5>makes a ton of sense because this company is still

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<v Speaker 5>reliant on hardware at the end of the day. That

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<v Speaker 5>is what drives that one hundred billion in free cash

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<v Speaker 5>flow that they generate. It's the hardware refreshes and you know,

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<v Speaker 5>they have missed out on the LM side. There are

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<v Speaker 5>still questions that need to be answered in terms of

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<v Speaker 5>what the new CEO strategy will be in terms of AI,

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<v Speaker 5>CAPEX and llms. But if there was one person internally

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<v Speaker 5>who would have thought it should have been their hardware chief,

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<v Speaker 5>and so that's a good point.

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<v Speaker 4>I always think about like the right guy for the

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<v Speaker 4>right time, and we've been talking a lot about Tim

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<v Speaker 4>Cook and how he understood the global supply chain really

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<v Speaker 4>in building that, and so that was maybe his tenure

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<v Speaker 4>for john turnas. Is it, Mandy about protecting the hardware

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<v Speaker 4>and the sales that they've got and then also trying

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<v Speaker 4>to figure out how do you expand it? Is that

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<v Speaker 4>part of what he has to do or is it

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<v Speaker 4>about really just protecting the core here.

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<v Speaker 5>So look, when Johnny I've left Apple and he joined

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<v Speaker 5>open Ai, there was a lot of speculation around what

0:12:51.840 --> 0:12:54.839
<v Speaker 5>that new form factor will be on the hardware side

0:12:54.840 --> 0:12:58.920
<v Speaker 5>when it comes to consuming llms on the edge. Right now,

0:12:59.040 --> 0:13:03.000
<v Speaker 5>all the llms are or running on data centers because

0:13:03.000 --> 0:13:05.320
<v Speaker 5>they need a lot of power. There will be a

0:13:05.400 --> 0:13:08.880
<v Speaker 5>point when the lms can be distilled and run on device,

0:13:09.320 --> 0:13:13.120
<v Speaker 5>and that's the time where Apple has to have that

0:13:13.240 --> 0:13:16.559
<v Speaker 5>perfect form factor. I mean, we know their vertical integration

0:13:16.640 --> 0:13:19.319
<v Speaker 5>has served them well in terms of having their own

0:13:19.440 --> 0:13:23.720
<v Speaker 5>chip making sure the specs are customized to running Apple's

0:13:23.720 --> 0:13:27.000
<v Speaker 5>operating system. They need to do the same for LLM

0:13:27.040 --> 0:13:29.360
<v Speaker 5>and that's where you know having somebody who runs the

0:13:29.400 --> 0:13:32.880
<v Speaker 5>hardware division is the right guy to make that transition.

0:13:33.720 --> 0:13:36.600
<v Speaker 5>My guess is they will probably be more acquisitive than

0:13:36.640 --> 0:13:38.040
<v Speaker 5>they have been under Tim Cook.

0:13:38.480 --> 0:13:40.000
<v Speaker 1>For what what would they buy?

0:13:40.040 --> 0:13:43.560
<v Speaker 5>I mean, there are so many GENAI native companies with

0:13:44.400 --> 0:13:48.240
<v Speaker 5>very you know, high valuations in the private market.

0:13:48.520 --> 0:13:49.200
<v Speaker 2>They may have.

0:13:49.520 --> 0:13:52.000
<v Speaker 1>Some of those are way too expensive to be bought

0:13:52.000 --> 0:13:52.520
<v Speaker 1>by anyone.

0:13:52.720 --> 0:13:55.920
<v Speaker 5>Yeah, Look, I mean a company like company like Anthropic

0:13:56.080 --> 0:13:59.520
<v Speaker 5>has seen its valuation double almost you know, every three months,

0:13:59.800 --> 0:14:01.960
<v Speaker 5>so they are probably out of reach right now, but

0:14:02.880 --> 0:14:09.160
<v Speaker 5>they perplexity, perplexity cursor. There are a lot of names

0:14:09.240 --> 0:14:12.200
<v Speaker 5>that are still in that range where yes, you may

0:14:12.200 --> 0:14:14.959
<v Speaker 5>have to end up spending fifty two hundred billion dollars,

0:14:15.480 --> 0:14:17.600
<v Speaker 5>but there will be consolidation and.

0:14:17.920 --> 0:14:18.840
<v Speaker 1>That's a lot.

0:14:19.000 --> 0:14:24.560
<v Speaker 5>But look, that's where because they haven't really invested in

0:14:24.200 --> 0:14:27.160
<v Speaker 5>their own AI efforts, they will have to acquire it.

0:14:27.240 --> 0:14:29.320
<v Speaker 4>So that idea of kind of is it Gemini that

0:14:29.360 --> 0:14:34.080
<v Speaker 4>they were working on, or is Google's AI not Gemini Gemini. Yeah,

0:14:34.680 --> 0:14:37.720
<v Speaker 4>that idea of kind of letting them figure it out

0:14:37.840 --> 0:14:38.640
<v Speaker 4>and then rely on that.

0:14:38.800 --> 0:14:39.880
<v Speaker 1>I think it's a great idea.

0:14:39.960 --> 0:14:42.400
<v Speaker 4>Well I kind of I thought it was too, but

0:14:42.480 --> 0:14:45.560
<v Speaker 4>that doesn't make sense. I mean, it holds them back.

0:14:45.600 --> 0:14:48.280
<v Speaker 5>When it comes to AI. I think a company of

0:14:48.400 --> 0:14:52.360
<v Speaker 5>Apple size wants to have its own LM. That's what

0:14:52.440 --> 0:14:55.880
<v Speaker 5>Amazon did Amazon, you know, invested in Anthropic, but then

0:14:56.000 --> 0:15:00.360
<v Speaker 5>in parallel they were training their own LLM, and so

0:15:00.920 --> 0:15:05.440
<v Speaker 5>Microsoft invested in open Ai. Now the relationship isn't going

0:15:05.560 --> 0:15:09.360
<v Speaker 5>very well. Microsoft is investing in its own LLLM. So

0:15:09.520 --> 0:15:13.920
<v Speaker 5>from that standpoint, I would be surprised if Apple strategies

0:15:14.120 --> 0:15:17.240
<v Speaker 5>just to rely on Gemini, even though Google has been

0:15:17.240 --> 0:15:18.920
<v Speaker 5>a great partner over the years for them.

0:15:19.040 --> 0:15:21.040
<v Speaker 1>We should go back to the stock reaction here, it's

0:15:21.120 --> 0:15:23.720
<v Speaker 1>just down about four tenths of one percent right now.

0:15:24.040 --> 0:15:26.560
<v Speaker 1>It doesn't seem like investors, at least in the after

0:15:26.600 --> 0:15:29.440
<v Speaker 1>hours envolumes. Then we should wait for tomorrow. Of course,

0:15:30.440 --> 0:15:32.040
<v Speaker 1>are two concerned with this?

0:15:32.600 --> 0:15:35.520
<v Speaker 5>Yeah, I mean I think this is probably the best

0:15:35.560 --> 0:15:38.560
<v Speaker 5>transition you could have hoped for a company like Apple,

0:15:38.720 --> 0:15:42.680
<v Speaker 5>you know, where the internal guy who was leading the

0:15:42.680 --> 0:15:48.000
<v Speaker 5>most important division in the company becomes the CEO. And look,

0:15:48.240 --> 0:15:52.360
<v Speaker 5>I mean strategically there are still questions that you want

0:15:52.920 --> 0:15:57.560
<v Speaker 5>answers for, but this is probably laying out a roadmap

0:15:57.600 --> 0:16:01.760
<v Speaker 5>where they're saying, you know, he'll be CEO offecting September

0:16:01.800 --> 0:16:05.200
<v Speaker 5>and uh, he'll have some months to plan out you know,

0:16:05.240 --> 0:16:07.720
<v Speaker 5>what he wants to do differently versus what Tim Kok

0:16:07.920 --> 0:16:10.880
<v Speaker 5>was doing, especially when it comes to the acquisition side.

0:16:10.880 --> 0:16:14.320
<v Speaker 5>I feel that's the one area where Apple has missed

0:16:14.320 --> 0:16:18.160
<v Speaker 5>out and you want to see, you know, a more

0:16:18.200 --> 0:16:20.360
<v Speaker 5>sense of urgency when it comes to acquisitions.

0:16:20.360 --> 0:16:22.240
<v Speaker 4>Well, and it does feel like Tim Cook, you know,

0:16:22.480 --> 0:16:24.880
<v Speaker 4>not going anywhere. So it does feel actually to me

0:16:25.200 --> 0:16:26.360
<v Speaker 4>very orderly.

0:16:26.080 --> 0:16:28.000
<v Speaker 1>Springs where he's got the vacation house.

0:16:27.840 --> 0:16:30.360
<v Speaker 4>But it feels very orderly like he's going to be around.

0:16:31.360 --> 0:16:33.640
<v Speaker 4>It's not till September, right, He's going to help with

0:16:33.640 --> 0:16:35.920
<v Speaker 4>the transition, and then he's going to still be there

0:16:35.960 --> 0:16:39.359
<v Speaker 4>on those big global issues that can be super complicated

0:16:39.360 --> 0:16:41.840
<v Speaker 4>as a big global company in terms of dealing with

0:16:41.960 --> 0:16:44.280
<v Speaker 4>leaders right where your supply chain in is and as

0:16:44.280 --> 0:16:46.240
<v Speaker 4>you move it around. He's going to still do that stuff.

0:16:46.320 --> 0:16:48.520
<v Speaker 4>Or do you feel like that's just just in the

0:16:48.520 --> 0:16:50.040
<v Speaker 4>press release or do you think that's real?

0:16:50.400 --> 0:16:52.880
<v Speaker 1>I think it's I have a heart. Tim Cook has

0:16:52.960 --> 0:16:55.600
<v Speaker 1>been his career. No, I know, I know, and a

0:16:55.600 --> 0:16:57.880
<v Speaker 1>lot of I mean Mark, Mark has talked to us

0:16:57.920 --> 0:17:00.760
<v Speaker 1>about this that outside of Apple, like I mean he's

0:17:00.800 --> 0:17:06.160
<v Speaker 1>known for somebody who works out and who works at Apple. Yeah,

0:17:06.160 --> 0:17:09.639
<v Speaker 1>but that's what he works on, No, he right, he

0:17:09.840 --> 0:17:12.960
<v Speaker 1>is very dedicated to this company. I would be I

0:17:12.960 --> 0:17:15.280
<v Speaker 1>would be shocked, is my own personal opinion. I would

0:17:15.280 --> 0:17:17.720
<v Speaker 1>be shocked to see him to go completely.

0:17:18.040 --> 0:17:19.560
<v Speaker 4>What's your take though on that.

0:17:19.640 --> 0:17:24.080
<v Speaker 5>Is that we are seeing some very you know, long

0:17:24.119 --> 0:17:29.320
<v Speaker 5>tenured CEOs leave Adobe CEO he's stepping down. So look,

0:17:29.359 --> 0:17:32.840
<v Speaker 5>these guys have been at the home for almost two

0:17:32.880 --> 0:17:37.720
<v Speaker 5>decades and at this point they feel, you know, there

0:17:37.800 --> 0:17:40.359
<v Speaker 5>is too big off a change that's going around them,

0:17:40.440 --> 0:17:44.760
<v Speaker 5>and it's good to have a new leader. And I'm

0:17:44.840 --> 0:17:48.760
<v Speaker 5>sure there will be things that get changed under the

0:17:48.840 --> 0:17:49.400
<v Speaker 5>new leadership.

0:17:49.440 --> 0:17:50.240
<v Speaker 4>I think he was pressured.

0:17:50.320 --> 0:17:53.840
<v Speaker 5>Tim Cook, No, no, I would be very surprised if

0:17:53.920 --> 0:17:55.120
<v Speaker 5>that was the case.

0:17:55.280 --> 0:17:57.480
<v Speaker 1>We should pull up the chart again from twenty eleven

0:17:57.560 --> 0:18:02.159
<v Speaker 1>to twenty twenty six. Okay, okay, show show Apple's returns

0:18:02.240 --> 0:18:05.359
<v Speaker 1>over that period of time. Where what look at that

0:18:05.520 --> 0:18:09.440
<v Speaker 1>nineteen If anything, he was praised for April from August.

0:18:09.800 --> 0:18:13.040
<v Speaker 5>He was praised for his capital allocation strategy and you

0:18:13.080 --> 0:18:17.320
<v Speaker 5>know Bsher Hatsway became Warren Buffett became a shareholder. So

0:18:17.720 --> 0:18:22.040
<v Speaker 5>Apple's capital allocation has been top notch. But probably I

0:18:22.040 --> 0:18:24.359
<v Speaker 5>would say in the last two three years is where

0:18:24.400 --> 0:18:28.119
<v Speaker 5>there are question marks. Around why didn't they raise kapex

0:18:28.160 --> 0:18:31.280
<v Speaker 5>for these AI data centers and all their Max seven

0:18:31.320 --> 0:18:33.040
<v Speaker 5>piers were investing.

0:18:33.080 --> 0:18:35.159
<v Speaker 4>So I still think there's something to like kind of

0:18:35.160 --> 0:18:36.840
<v Speaker 4>waiting for these guys to figure it out.

0:18:37.280 --> 0:18:39.320
<v Speaker 1>They didn't make the first music player, they didn't make

0:18:39.359 --> 0:18:41.480
<v Speaker 1>the first tablet, they didn't make the first smartphone, but

0:18:41.560 --> 0:18:43.479
<v Speaker 1>many people would say they've made the best of all

0:18:43.520 --> 0:18:45.800
<v Speaker 1>those things. Maybe the same thing happens with AI.

0:18:46.520 --> 0:18:49.720
<v Speaker 5>I mean, they have a lock on distribution and it's

0:18:49.760 --> 0:18:52.679
<v Speaker 5>still there, but this is like too risky of a

0:18:52.760 --> 0:18:56.360
<v Speaker 5>strategy where you completely miss out on one of the

0:18:56.400 --> 0:19:00.600
<v Speaker 5>biggest secular trends that probably I think we're going to

0:19:00.640 --> 0:19:04.240
<v Speaker 5>witness over the next two three decades. And you're you're saying,

0:19:04.320 --> 0:19:06.040
<v Speaker 5>I'm just gonna rely on distribution.

0:19:07.880 --> 0:19:11.879
<v Speaker 1>M h m hmmmmmm hm