Mature company on the decline last 5 of 6 quarters. If not buying back stock, they’d be crushed.
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Apple Reports 2Q 2024 Results: $23.6B Profit on $90.8B Revenue
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Mature company on the decline last 5 of 6 quarters. If not buying back stock, they’d be crushed.
Tim Cook couldn't answer because he wants to keep it a secret that Apple will be making money from AI through Alphabet paying Apple tens of billions each year to make Gemini (Google's AI) their default AI tool on all Apple devices in the same way Alphabet pays Apple tens of billions each year to make Google the default search engine.
Actually if you do a search for the below line used on that X post it yields no matches stated by Tim Cook.
Its like this article creatively modified to express that but not based on actual quotes that I find
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there are only 3 companies making money using AI.
OpenAI
Microsoft Copilot
Tesla FSD
everything else is just gimmick.
Give him $100B and I’m sure he will be.
I’ll spell it out for you. There is an opportunity cost to spending billions on stock buybacks instead of growing your business and IP. You don’t need specific technological examples to understand this unless you also need someone to regularly wipe drool from your face. One would think that a company that is bereft of new ideas would be better served in the long run by R&D investments instead of using its resources to pump the stock price.
I hope I am wrong, but peak "Hardware Apple" might be behind us, no vision and no ideas except to use cash to buy back stock. The only exception is Apple Silicon, thankfully still not taken over by lazy design and staying away from engineering focused on irrelevant advancements.
However, growth in services is impressive and Apple will slowly transform to be more of a service company then device company.
However, growth in services is impressive and Apple will slowly transform to be more of a service company then device company.
Here's a transcript of the Apple conference call from today: https://seekingalpha.com/article/4688870-apple-inc-aapl-q2-2024-earnings-call-transcript
Here's the part you couldn't find. I've enlarged and put it in bold for you
Operator: Our next question is from Erik Woodring with Morgan Stanley. Please go ahead.
Erik Woodring: Great. Thanks so much for taking my questions. Maybe my first one, Tim, you've obviously mentioned your excitement around Generative AI multiple times. I'm just curious how Apple is thinking about the different ways in which you can monetize this technology because historically software upgrades haven't been a big factor in driving product cycles. And so could AI be potentially different? And how could that impact replacement cycles? Is there any services angle you'd be thinking? Any early color that you can share on that? And then I have a follow up, please. Thanks.
Tim Cook: I don't want to get in front of our announcements, obviously. I would just say that we see Generative AI as a very key opportunity across our products. And we believe that we have advantages that set us apart there. And we'll be talking more about it in as we go through the weeks ahead.
Erik Woodring: Okay. Very fair. Thank you. And then Luca, maybe to just follow up on Wamsi's comments or question. There's a broad concern about the headwind that rising commodity costs have on your product gross margins. Wondering if you could just clarify for us if we take a step back and look at all of the components and commodities that go into your products kind of collectively, are we -- are you seeing these costs rising? Are they falling? What tools do you have to try to help and mitigate some rising costs if at all, rising input costs if at all? Thank you so much.
Luca Maestri: Yes. I mean during the last quarter, commodity costs, and in general, component costs have behaved favorably to us. On the memory front, prices are starting to go up. They've gone up slightly during the March quarter. But in general, I think it's been a period not only this quarter, but the last several quarters where, you know, commodities have behaved well for us.
Commodities going cycles and so there's obviously always that possibility. Keep in mind that we are starting from a very high level of gross margins. We reported 46.6%, which is something that we haven't seen in our company in decades. And so we're starting from a good point. As you know, we try to buy ahead when the cycles are favorable to us. And so we will try to mitigate if there are headwinds. But in general, we feel particularly for this cycle, we are in good shape.
Erik Woodring: Thank you so much.
Suhasini Chandramouli: Great. Thank you, Erik. Operator, we'll take the next question, please.
It’s all Tim Apples fault.
Never would have happened under Steve….
Same same every year.
Having tried Tesla FSD test I would say anyone paying for it being misled…
Doubt many are using Microsoft Copilot either. Too new. And paying option never appeals
You may not be aware that Apple already has a very robust R&D program, spending around $30 billion last year. No worries... Apple is working on new ideas. Try not to feel bad that they're not looping you in on what they are.
Why not? They seem to use Linux in their AI research for example:
MLOps Engineer - Zurich Vision Lab - Careers at Apple
Apply for a MLOps Engineer - Zurich Vision Lab job at Apple. Read about the role and find out if it’s right for you.
And I wonder if their chip design and other CAD tools are running on macOS... or also on Linux (or Windows).
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It is amazing what a large chunk of that is services...
You'd think they would want to stop cheaping out on things like RAM just to attract more people into the ecosystem, to extract more services revenue from them.
You'd think they would want to stop cheaping out on things like RAM just to attract more people into the ecosystem, to extract more services revenue from them.
Just think, people on here still actively defend the low RAM and storage, and the astronomical markup costs. 🤦♂️ Great for shareholders only until it sours the customers on the product.
Anecdotal evidence. Apple's numbers tell a different story.
Apple does stock buybacks for years now, with increasing intensity. Their stated goal is to bet to cash neutral, coming from a big pile of cash.
Steve Jobs would be rolling in his grave. He hated buybacks and loved the security of piles of cash.
Is there anyone here who actually thinks that Apple should just keep all that money in the bank and watch it get eroded by inflation, vs returning it to shareholders?
This company "can't innovate" anymore, but certainly has consistent appeal regardless. Apple used to be the frontier on all the big things, from the iPod to iPhone to the Macbook Air to the iPad and to "Retina" displays, but starting with the Apple Watch and horribly made evident by the Vision Pro, they became too niche and less like they can predict the future.
Yeah removing the CD drive is not the end of the world on a Mac for most, but it still stings that they kept to this "no SD card, buy our iCloud storage for more" policy all this time and then pulled away from the 3.5mm aux cable, leading almost the entire industry in an awful direction because of it.
Yeah removing the CD drive is not the end of the world on a Mac for most, but it still stings that they kept to this "no SD card, buy our iCloud storage for more" policy all this time and then pulled away from the 3.5mm aux cable, leading almost the entire industry in an awful direction because of it.
Invest more in R&D and make the products better and cheaper for the customer so they love the brand. Jobs wasn't an idiot. Piles of cash also allow they more freedom for innovation. Also, what gives you the impression they wouldn't be investing their piles of cash and earning more on it than inflation?!?
Apple already has an R&D budget and I don’t think there is any endeavour that merits 110 billion a year in investment. Like I said, the two are not mutually exclusive, and Apple is not issuing share buybacks at the expense of any other areas.
If anything, I would argue that not having as much spare cash on hand represents less of a risk of Apple trying to squander the money on some flashy but wasteful investment like say, acquiring Netflix? Remember when people claimed that Apple ought to do so?