Apple's Q2 2024 Earnings Call Takeaways

[Surf Monkey]

I think of it like the Watch pivot from phone sidekick to health device. They’re just re-aiming it at where it’s popular.

Well, yeah. Obviously. That’s why I characterized it as a “hard pivot.” They realized that it’s never going to be a mainstream computing device so they’ve had to refocus their efforts on enterprise.

Just like EVERY OTHER AR/VR MAKER HAS.

So the ridiculous hype about Vision being the “future of computing” was clearly nonsense.

 

[Surf Monkey]

The ability to see what you want to see and dismiss everything else is amazing.

I did no such thing.

You ask for a reference, and they point you to the statement, only for you to dismiss it by implying that Apple lied about KLM using the Vision Pro on a public investment call.

The statement was not documented. That was the issue.

You say that Tim telling investors that companies are using the Vision Pro is evidence of a pivot to enterprise when we have evidence as recent as the 1.1 update that enterprise has always been part of the plan. But because you dont understand how B2B sales work, you believe that Apple has never been interested in enterprise (despite selling the iPhone B2B since 2008).

Come on now. Go watch the keynote. This attempt to retroactively claim that Apple always intended it as an enterprise device is hogwash on the face of it.

Of course, you believe an analyst who provided three sets of conflicting numbers about how many can actually be made and what Apple “projected” for sales because the thought of no sales fits your narrative.

I do? No. False. I’ve never made such a claim.

How accurate were his iPhone China sales predictions?

Irrelevant.

 

[Surf Monkey]

What's also interesting is that he notes growth in China, which goes against the narrative that the iPhone is losing to Huawei (and violates the broader narrative that Apple is getting less innovative over time).

Hmm. How does supposed expanded growth in China counter charges that Apple is getting less innovative? Are they releasing some products there we’re not aware of?

As a general rule of thumb, I think many people here are too eager to buy into negative news surround Apple because it gives them an outlet to vent about every bugbear they have had with Apple so far, regardless of accuracy. I would advise everyone here not to bet against Apple too much. Such negativity rarely ever works out in their favour in the long run.

Concurrently there is a large contingent of people here who are SO invested in their Apple fandom that no criticism whatsoever can be seen as even glancingly relevant and any individual expressing such criticism must be met with the most aggressive and negative reaction possible within the board’s rules.

 

[Kemba11]

Come on now. Go watch the keynote. This attempt to retroactively claim that Apple always intended it as an enterprise device is hogwash on the face of it.

Because Apple always highlights enterprise functionality on its devices during Keynotes? B2B sales don’t have marketing, they have a deck and a device and walk a company through how it can benefit them, and how it may be customized to fit their needs. Why wouldn’t they have planned to sell this to businesses? They added the remote management function for some reason, right?

I do? No. False. I’ve never made such a claim.



Irrelevant.

Earlier you said to rename it “oops No customers” what are you basing that on?

 

[Abazigal]

Hmm. How does supposed expanded growth in China counter charges that Apple is getting less innovative? Are they releasing some products there we’re not aware of?

It seemed that in general, people bought too willingly into the "Huawei is eating Apple's lunch" narrative when in reality, Apple seems to still be doing okay in China. Yes, there seems to be a little bit of sales weakness based on Apple's own Q1 reports, but nothing that should set off alarm bells.

China iPhone Sales Likely to Continue Losing Ground to Huawei in 2024

Apple appears to be facing an uphill battle to reverse falling iPhone sales in China, with last year's double-digit decline projected to deepen through 2024 owing to strong interest in Huawei's latest home-grown lineup, according to analyst expectations (via Bloomberg). Huawei Mate 60 Pro In...

forums.macrumors.com

iPhone Sales in China Declined 24% in First Six Weeks of 2024

Apple's iPhone sales in China saw a significant decline in the first six weeks of this year that saw it lose the title of China's best-selling smartphone maker to a local vendor. iPhone sales dropped by 24 percent, pushing Apple down to fourth among smartphone makers in the country, according...

forums.macrumors.com

iPhone Sales in China Dropped Significantly in Q1 2024

Nice to see all that bowing down to China Tim Cook does is working out well for him.

forums.macrumors.com

It stands to reason that revenue is down in China due to customers holding off on non-phone purchases such as iPads, Macs and wearables (based on Apple's own data of iPhone sales being up but overall revenue being down), but otherwise, iPhone sales seem to still be doing all right. My takeaway here is that no publication has meaningful insight into how well (or poorly) the iPhone is selling through Apple's direct distribution channels. As such, any report claiming that Apple sales are down should probably be treated with a lot of skepticism than they are currently being received (but they won't).

It also puts news like this in a new light, which probably deserve new scrutiny, but I don't think people here are interested in being right as much as they are more interested in ragging on Apple every chance they get.

Android Bosses iPhone in Smartphone Activation Market Share

New iPhone activations are down to a low not seen in the U.S. smartphone market for the last six years, according to a new Consumer Intelligence Research Partners (CIRP) report. While CIRP notes that Apple's installed smartphone base is higher than recorded activations, the figures show its...

forums.macrumors.com

Concurrently there is a large contingent of people here who are SO invested in their Apple fandom that no criticism whatsoever can be seen as even glancingly relevant and any individual expressing such criticism must be met with the most aggressive and negative reaction possible within the board’s rules.

The issue here isn't the criticism of Apple. The issue is that people often try to link said criticism to any perceived dip in Apple's overall financial performance as evidence that Apple has lost the plot and that they are experiencing the repercussions of not doing something "innovative" like acquiring Netflix, or releasing a folding phone, or a round smartwatch. We have seen this being played out since the start. Apple is doomed if they don't release a netbook, if they don't release a cheaper phone, if they don't open up iOS, if they do something the competition is doing, when said competition isn't even turning a profit or making something that consumers want.

It's one thing to not like something that Apple is doing. It's another to assert that Apple is failing because of it because then, it demonstrates that they are more invested in making statements rooted in ideology than they are interested in being right.

if pointing out my immense skepticism towards the numerous negative comments here is somehow being overly aggressive and acerbic, then I really don't know what else to say.

 

[Surf Monkey]

Because Apple always highlights enterprise functionality on its devices during Keynotes? B2B sales don’t have marketing, they have a deck and a device and walk a company through how it can benefit them, and how it may be customized to fit their needs. Why wouldn’t they have planned to sell this to businesses? They added the remote management function for some reason, right?

Looks like so much rationalization to me. Apple directed their pitch at average people. Dads taking pictures of their kids, people watching movies, doing FaceTime and so forth. Meanwhile Tim Cook was on TV. Where? Good Morning America for one. A broadcast that targets general consumers, not enterprise. Apple’s entire marketing effort behind it was pitched towards consumers. Not businesses.

Earlier you said to rename it “oops No customers” what are you basing that on?

I based it on Cap’n Crunch’s “Oops, All Berries.”

As far as sales go, there has been voluminous reporting on it from various sources. The overall impression is that the hype around it died down in two weeks, that demo appointments are down, that units sit on the shelf unsold… I mean, it isn’t like I made it up.

 

[Surf Monkey]

It seemed that in general, people bought too willingly into the "Huawei is eating Apple's lunch" narrative when in reality, Apple seems to still be doing okay in China. Yes, there seems to be a little bit of sales weakness based on Apple's own Q1 reports, but nothing that should set off alarm bells.

China iPhone Sales Likely to Continue Losing Ground to Huawei in 2024

Apple appears to be facing an uphill battle to reverse falling iPhone sales in China, with last year's double-digit decline projected to deepen through 2024 owing to strong interest in Huawei's latest home-grown lineup, according to analyst expectations (via Bloomberg). Huawei Mate 60 Pro In...

forums.macrumors.com

iPhone Sales in China Declined 24% in First Six Weeks of 2024

Apple's iPhone sales in China saw a significant decline in the first six weeks of this year that saw it lose the title of China's best-selling smartphone maker to a local vendor. iPhone sales dropped by 24 percent, pushing Apple down to fourth among smartphone makers in the country, according...

forums.macrumors.com

iPhone Sales in China Dropped Significantly in Q1 2024

Nice to see all that bowing down to China Tim Cook does is working out well for him.

forums.macrumors.com

It stands to reason that revenue is down in China due to customers holding off on non-phone purchases such as iPads, Macs and wearables (based on Apple's own data of iPhone sales being up but overall revenue being down), but otherwise, iPhone sales seem to still be doing all right. My takeaway here is that no publication has meaningful insight into how well (or poorly) the iPhone is selling through Apple's direct distribution channels. As such, any report claiming that Apple sales are down should probably be treated with a lot of skepticism than they are currently being received (but they won't).

It also puts news like this in a new light, which probably deserve new scrutiny, but I don't think people here are interested in being right as much as they are more interested in ragging on Apple every chance they get.

Android Bosses iPhone in Smartphone Activation Market Share

New iPhone activations are down to a low not seen in the U.S. smartphone market for the last six years, according to a new Consumer Intelligence Research Partners (CIRP) report. While CIRP notes that Apple's installed smartphone base is higher than recorded activations, the figures show its...

forums.macrumors.com

The issue here isn't the criticism of Apple. The issue is that people often try to link said criticism to any perceived dip in Apple's overall financial performance as evidence that Apple has lost the plot and that they are experiencing the repercussions of not doing something "innovative" like acquiring Netflix, or releasing a folding phone, or a round smartwatch. We have seen this being played out since the start. Apple is doomed if they don't release a netbook, if they don't release a cheaper phone, if they don't open up iOS, if they do something the competition is doing, when said competition isn't even turning a profit or making something that consumers want.

It's one thing to not like something that Apple is doing. It's another to assert that Apple is failing because of it because then, it demonstrates that they are more invested in making statements rooted in ideology than they are interested in being right.

if pointing out my immense skepticism towards the numerous negative comments here is somehow being overly aggressive and acerbic, then I really don't know what else to say.

1) still unclear how innovation figures into your first argument. I get what you’re saying and agree. I just don’t see how it says anything about Apple’s ability to innovate.

2) In regard to criticism of Apple I think it’s more tied up with people taking it PERSONALLY. As if having something critical to say about Apple is saying something critical of THEM.

3) No worries. I wasn’t referencing you. Just pointing out the other side of the coin.

 

[citysnaps]

All hearsay, every link goes back to apple PR making the claim enterprise businesses are using vision pro, with no details of what spatial apps, just leaving the details to readers imagination.

Well... I guess one can reflexively go through life believing Apple lies about everything.

Or... one can imagine the myriad uses AVP, or any AR device for that matter, can and already does have in a large number of business/commercial/educational/military/research/training/etc, etc spaces.

Apple entering the above markets will expand those and other markets even further.

 

[Kemba11]

Looks like so much rationalization to me. Apple directed their pitch at average people. Dads taking pictures of their kids, people watching movies, doing FaceTime and so forth. Meanwhile Tim Cook was on TV. Where? Good Morning America for one. A broadcast that targets general consumers, not enterprise. Apple’s entire marketing effort behind it was pitched towards consumers. Not businesses.

You like to tell people there rationalizing when you don’t seem to understand.

Yes Apple is marketing the device to consumers. Yes Tim Cook was on GMA trying to reach consumers. Just like it does with most of its devices.
But at the same time there are teams of people at Apple trying to sell industry on the Vision Pro. Just like it does with most of its devices. There’s no shift. No pivot. The marketing you see and recognize, for just about all of Apples devices is made for consumers. But you think they aren’t also selling the same devices to industry? It can be both.

I based it on Cap’n Crunch’s “Oops, All Berries.”

As far as sales go, there has been voluminous reporting on it from various sources. The overall impression is that the hype around it died down in two weeks, that demo appointments are down, that units sit on the shelf unsold… I mean, it isn’t like I made it up.

No you’re just relying on someone who made it up. You sure there are multiple sources, or multiple reports quoting the same source? Honestly I have no idea how well it’s selling. But neither do you.

 

[citysnaps]

So you think they’re marketing it in secret. That’s not a rationalization at all.

Generally, no. But could be in some applications/uses under NDA.

I've worked at two Silicon Valley defense/aerospace companies in the past where we had a relationship with Apple. Apple had a group that would market to us. They would also solicit our thoughts and needs for future Apple products. We also used some Apple products within systems we developed and augmented with our own custom hardware and software to sell as a complete system to the government.

There was no need or desire to broadcast those relationships publicly.

The above is not an unusual situation.

 

[Jumpthesnark]

Hand holding is not the issue. Snotty directives to “google it” is.

And now that I have held your hand to let you know how easy it was to find the information, and provided the link, do you believe your own eyes? Because I saw no reply to the actual issue at hand (which is how basic debate actually works), just attempts at distractions with patronizing remarks.

Would love to hear your response to the actual information in the linked article I provided for you.

Please enlighten us.

 

[Surf Monkey]

You like to tell people there rationalizing when you don’t seem to understand.

False.

Yes Apple is marketing the device to consumers. Yes Tim Cook was on GMA trying to reach consumers. Just like it does with most of its devices.
But at the same time there are teams of people at Apple trying to sell industry on the Vision Pro. Just like it does with most of its devices. There’s no shift. No pivot. The marketing you see and recognize, for just about all of Apples devices is made for consumers. But you think they aren’t also selling the same devices to industry? It can be both.

Prove it then. Talk is cheap. I’m commenting on their public facing marketing for the device. You’re speculating.

No you’re just relying on someone who made it up. You sure there are multiple sources, or multiple reports quoting the same source? Honestly I have no idea how well it’s selling. But neither do you.

Pretty feeble denial IMO. As I said, many sources have been reporting on the Vision. The idea that I’m fabricating it or relying on some utterly discredited source is nonsense.

 

[Surf Monkey]

And now that I have held your hand to let you know how easy it was to find the information, and provided the link, do you believe your own eyes? Because I saw no reply to the actual issue at hand (which is how basic debate actually works), just attempts at distractions with patronizing remarks.

Would love to hear your response to the actual information in the linked article I provided for you.

Please enlighten us.

The ease of using google is not the point. In fact it’s you who’s being patronizing. As I said, it is not on me to prove claims I didn’t make. I’m sorry that you appear not to grasp this basic point.

 

[Kemba11]

False.



Prove it then. Talk is cheap. I’m commenting on their public facing marketing for the device. You’re speculating.

Prove what? That Apple devices marketed to consumers are routinely sold to enterprises? Including the Vision Pro. That’s a fact.

The person speculating is the one stating that since Apple mentioned enterprise sales on an investors call, they are now pivoting away from the consumer market that they presented at the Keynote and that they never planned on selling this to industry.

 

[Jumpthesnark]

Link?

You asked for the link, as seen above, after another poster said "KLM is using ‌Apple Vision Pro‌ to train aircraft engine mechanics." I handed it to you. The article discusses KLM's use of the AVP. It quotes a KLM executive. So, again, I would love to hear your response to the actual information in the linked article I provided for you.

If all you want to do is continue attacking other posters, that's fine, it's your choice. But it tells me that you're not interested in having a discussion about the topic at hand, and that the request for a link was disingenuous.

 

[CarAnalogy]

Not a good look for Apple Vision Pro when Tim is highlighting its’ use in enterprise. Magic Leap and HoloLens have gone this route, but both are TRUE AR. Apple has no clue how to market Apple Vision Pro at this point.

And even given what he said, a careful reading shows it doesn't actually say anything. They "see" use in aircraft engine repair etc. Do they "see" this as a potential use case or actually "see" people doing it? And not as a one time trial, but actually using it.

Boeing can't even properly bolt down door seals, and spends more money silencing whistleblowers than on aircraft maintenance. The military can barely afford the planes. Who is buying this toy for their highly specialized and trained aircraft mechanics? I don't want to get into an airplane the mechanic needed to be walked through fixing.

Edit: Apparently KLM airlines? But the first question still stands. Are they actually rolling this out as part of their official toolkit and workflow, or are they just trialing one or two and still writing software for it?

 

[CarAnalogy]

Apple today held its earnings call for the second fiscal quarter of 2024 (first calendar quarter), with Apple CEO Tim Cook and Apple CFO Luca Maestri providing us with some details on Apple's performance, Vision Pro sales, services growth, AI plans, and other topics.

We've highlighted the most interesting takeaways from today's earnings call.

Next Week's Announcements

Apple CEO Tim Cook said Apple is prepping for "an exciting product announcement" that the company thinks "customers will love."

Standard boilerplate, says this every single time, means nothing.

Generative AI

Apple CEO Tim Cook said that Apple is making "significant investments" in AI, and that it has some "very exciting things" to share with customers "soon."

Cook also said that he believes Apple has "advantages that will differentiate" the company, including Apple's hardware and software integration, Apple silicon with Neural Engine, and focus on privacy.

There's a "big opportunity" for generative AI across all of Apple's devices, and Cook said he is "extremely optimistic" about future consumer demand.

Same as above.

Digital Markets Act

Cook said that it's too early to determine the security risks and privacy implications of the changes that it has made to the app ecosystem in Europe. Apple is focused on complying while mitigating impacts to user privacy and security.

This is an earnings call. Nobody is asking about security and privacy risks. How will this impact the money? Did no one call him out on this?

Vision Pro

Leading enterprise companies have been investing in Vision Pro, and Apple is seeing it used for things like aircraft engine maintenance, real-time collaboration for racing, and immersive kitchen design. Cook said that Apple "couldn't be more excited about the spatial computing opportunity in enterprise."

This is the most damning part of all. Total 180 from their initial sales pitch. Of course at $3500 and with no software the only people buying it would be enterprises which may write their own software for it. As others have said, this is the exact same path the other failed headsets went down.

Services

Apple's services segment set a new all-time revenue record of $23.9 billion, up 14 percent from $20.9 billion in the year-ago quarter. Transacting accounts and paid accounts reached a new all-time high, with paid accounts and subscriptions showing double digit growth.

Apple has more than 1 billion paid subscriptions, more than double the number from four years ago.

Yeah I know, because iOS has now started to become adware, putting up modal dialogs of Messi's face bothering me to subscribe to things. This may be good for the money but it's bad for consumers.

Mac Sales

With the launch of new M3 MacBook Air models in March, Mac revenue saw growth, reaching $7.5 billion. Mac sales were at $7.17 billion in the year-ago quarter, for four percent growth.

Good, start treating the Mac like a first class citizen again in terms of software design.

iPad Sales

iPad revenue continued to drop with no new iPads released in 2024 as of yet. iPad revenue was at $5.6 billion, down 17 percent from $6.7 billion a year ago. iPad sales should see some improvement next quarter as Apple next week is planning to unveil new iPad Air and iPad Pro models.

Predictable and will help next quarter's earnings.

Wearables

Wearables, Home and Accessories came in at $7.9 billion, down 10 percent compared to last year. Last year, Apple had launched the USB-C version of AirPods Pro, and there was a "difficult compare" this year.

Yeah no kidding. USB-C AirPods Pro is the last interesting thing they released in this category.

June Quarter

Maestri said that Apple expects June quarter revenue to grow low single digits year-over-year, but Services is expected to grow double digits, as is iPad revenue.

Article Link: Apple's Q2 2024 Earnings Call Takeaways

Of course it is because they're going to add even more subscriptions with iOS 18.

 

[citysnaps]

This is the most damning part of all. Total 180 from their initial sales pitch. Of course at $3500 and with no software the only people buying it would be enterprises which may write their own software for it. As others have said, this is the exact same path the other failed headsets went down.

Damning? No, expected for those who are familiar with AR and its uses in industry/business/medical/entertainment/military/education/...and on and on and on.

Of course companies will be writing their own software (using Apple APIs) as each company has different needs and objectives, requiring custom software. That's why Apple has APIs to help with that.

What cracks me up is so many here believing Apple all of a sudden had this stroke of brilliance that AVP (and other AR devices) could have a use in other than consumer markets. That's a real knee-slapper as AR has been used in many different commercial markets for years. Marketing AVP to commercial customers has been in their business plan ever since AVP was conceived.

 

[Surf Monkey]

You asked for the link, as seen above, after another poster said "KLM is using ‌Apple Vision Pro‌ to train aircraft engine mechanics." I handed it to you. The article discusses KLM's use of the AVP. It quotes a KLM executive. So, again, I would love to hear your response to the actual information in the linked article I provided for you.

If all you want to do is continue attacking other posters, that's fine, it's your choice. But it tells me that you're not interested in having a discussion about the topic at hand, and that the request for a link was disingenuous.

You’re the one attacking me, chief.

 

[CarAnalogy]

Marketing AVP to commercial customers has been in their business plan ever since AVP was conceived.

Maybe, but that absolutely was not their public facing story. Damning may be a bit of a strong word, but I meant that they promoted it as the future of computing for everyone and acted like consumers were gonna line up around the block like for the iPhone. They did not pitch it as a dev kit nor for enterprise use primarily.

I'm not saying this is unreasonable, I'm just saying that this does not look good for the product, especially contrasted against Apple's expectations. It doesn't look like the future of computing as Apple pitched it, just as another expensive AR headset with a limited use case, affordable only by people who can treat it as an investment in their already massive business.

 

[Surf Monkey]

Prove what? That Apple devices marketed to consumers are routinely sold to enterprises? Including the Vision Pro. That’s a fact.

The person speculating is the one stating that since Apple mentioned enterprise sales on an investors call, they are now pivoting away from the consumer market that they presented at the Keynote and that they never planned on selling this to industry.

I don’t consider your emotional response to be especially valid, actually.

 

[Surf Monkey]

Damning? No, expected for those who are familiar with AR and its uses in industry/business/medical/entertainment/military/education/...and on and on and on.

Of course companies will be writing their own software (using Apple APIs) as each company has different needs and objectives, requiring custom software. That's why Apple has APIs to help with that.

What cracks me up is so many here believing Apple all of a sudden had this stroke of brilliance that AVP (and other AR devices) could have a use in other than consumer markets. That's a real knee-slapper as AR has been used in many different commercial markets for years. Marketing AVP to commercial customers has been in their business plan ever since AVP was conceived.

What cracks you up is something you made up. No one is taking the position you described. I said “hard pivot” and I stand by that. Apple positioned the device as a general computing platform. They did NOT market it as an enterprise device. Therefore it is VERY telling that Tim chose NOT to address the obvious target market and instead shifted to talking about it as if it was ALWAYS intended for enterprise and B2B customers. That is blatantly and obviously not the case, no matter how much people here try to revise history and make it an emotional contest.

 

[citysnaps]

Maybe, but that absolutely was not their public facing story. Damning may be a bit of a strong word, but I meant that they promoted it as the future of computing for everyone and acted like consumers were gonna line up around the block like for the iPhone. They did not pitch it as a dev kit nor for enterprise use primarily.

I'm not saying this is unreasonable, I'm just saying that this does not look good for the product, especially contrasted against Apple's expectations. It doesn't look like the future of computing as Apple pitched it, just as another expensive AR headset with a limited use case, affordable only by people who can treat it as an investment in their already massive business.

Read what I wrote in post# 110. Apple has been serving the commercial/business/defense community since the beginning, with a separate marketing department.

Of course you haven't heard about it because that's generally not covered by consumer-focused websites oriented towards consumers.

 

[citysnaps]

What cracks you up is something you made up. No one is taking the position you described. I said “hard pivot” and I stand by that. Apple positioned the device as a general computing platform. They did NOT market it as an enterprise device. Therefore it is VERY telling that Tim chose NOT to address the obvious target market and instead shifted to talking about it as if it was ALWAYS intended for enterprise and B2B customers. That is blatantly and obviously not the case, no matter how much people here try to revise history and make it an emotional contest.

Read what I wrote just above. Your view that Apple just came up with the idea that AR and AVP could find use in commercial markets is insanely funny.

You'll need to try harder as it seems your goal is needing a reason to take a slam at Apple.

What's next? Apple just discovering their computers may have a use in business?

 

[Abazigal]

This is an earnings call. Nobody is asking about security and privacy risks. How will this impact the money? Did no one call him out on this?

The simple answer is that nobody really knows at this point, as it's wholly dependent on how many people actually choose to transact outside of the App Store. Apple has said that the EU accounts for only around 7% of their App Store revenue, and any financial impact is likely going to be only a fraction of that (ie: immaterial).

Standard boilerplate, says this every single time, means nothing.

Like you said, it's an earnings call, not a prelude to WWDC.

I don't know why you expect anything different. Past earnings calls gives one a pretty good idea of what information Apple is willing to give away, and what they choose not to.