Apple didn't need AI -- but it did need China -- to beat analysts' doom and gloom

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  • Reply 21 of 37
    Danox, is there literally something wrong with you? Your posts exists in this weird off-topic parallel universe where you seem to be parasite-style hosting your own disconnected, rambling blog via the comment section of AppleInsider. Your links often don't illustrate the points you think they do and you seem to be continually waging a holy war against some perceived insult against a trillion dollar corporation. What's your end game here? I've lurked on AI for years before making an account and maybe I'm burning whatever goodwill I have by posting this but swear to god you make zero sense.
    blastdoormuthuk_vanalingammacguimacxpresswilliamlondon
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  • Reply 22 of 37
    danoxdanox Posts: 3,907member
    Danox, is there literally something wrong with you? Your posts exists in this weird off-topic parallel universe where you seem to be parasite-style hosting your own disconnected, rambling blog via the comment section of AppleInsider. Your links often don't illustrate the points you think they do and you seem to be continually waging a holy war against some perceived insult against a trillion dollar corporation. What's your end game here? I've lurked on AI for years before making an account and maybe I'm burning whatever goodwill I have by posting this but swear to god you make zero sense.
    The links shows Dan Ives doesn’t exist in isolation every year for the last 15 or so years same old thing Apple in trouble because China sales have dropped yet when Apple announces their results low and behold what drop in China? China is the most competitive smartphone market in the world by far, and it also happens to be the largest. Apple has consistently been in the top five for the last 15 years yet they are always doomed every year in China.

    https://www.webpronews.com/dan-ives-slams-apples-ai-lag-urges-perplexity-buy-for-4t-future/  Crying about AI is basically the same.

    The links also show that there are a lot of analyst who are full of something, and the same meme is playing out when it comes to AI, Apple will take whatever time it needs to develop their Apple Intelligence system. Don’t like it switch to Android, or Microsoft Windows both have a larger marketshare and are ahead in being attached to super computers back home when you need a fix.
    edited August 2
    williamlondon
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  • Reply 23 of 37
    1348513485 Posts: 405member
    blastdoor said:
    I did not ask for evidence that people say negative thighs about Apple. I asked for evidence that   Webusch predicted a bad quarter (this most recent quarter, not a quarter two years from now) due to AI issues, because that’s what the person I was replying to asserted. Do any of your links support that specific claim? If the claim cannot be supported then I hope the author corrects the article.
    It's "Wedbush" and not "Wedbusch". Once is a typo, twice is not caring.

    blastdoormuthuk_vanalingammacguiwilliamlondon
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  • Reply 24 of 37
    dws-2dws-2 Posts: 281member
    Apple is a huge company, and has a ton of momentum. Their future depends on AI, and they’re definitely behind. I wouldn’t count them out, but I sure hope they have some more urgency than they’ve shown.
    williamlondon
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  • Reply 25 of 37
    blastdoor said:
    Right now, AI is a gimmick. Until it’s actually useful, it won’t make much impact.
    AI is tremendously useful right now. If it never improved beyond this point it would still be revolutionary. Unless by AI you mean Apple intelligence…
    By AI, I mean artificial intelligence; and, right now, AI has proven itself to be neither artificial nor intelligent. Using AI to magic up some pictures where people’s hands have six fingers, etc, isn’t revolutionary. If AI never improved beyond this point, it would fizzle out once people stopped being amused by its hallucinations. 
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  • Reply 26 of 37
    blastdoorblastdoor Posts: 3,871member
    blastdoor said:
    Right now, AI is a gimmick. Until it’s actually useful, it won’t make much impact.
    AI is tremendously useful right now. If it never improved beyond this point it would still be revolutionary. Unless by AI you mean Apple intelligence…
    By AI, I mean artificial intelligence; and, right now, AI has proven itself to be neither artificial nor intelligent. Using AI to magic up some pictures where people’s hands have six fingers, etc, isn’t revolutionary. If AI never improved beyond this point, it would fizzle out once people stopped being amused by its hallucinations. 
    That is not an accurate description of the current state of AI — in fact, it sounds like a hallucination.
    muthuk_vanalingammacguibloggerblogwilliamlondon
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  • Reply 27 of 37
    Apple knows exactly what it’s doing and is highly innovative.  It creates fantastic products which are very popular.  It has some successes and some failures. It works on ideas and they either happen or they don’t.

    Huge numbers of people speculate on what Apple is doing and most of the time they are wrong because they are not Apple and don’t think the same way: nor could a single individual or a few analysts ever think the way Apple does, simply by the number of people Apple employs on R and D, let alone any other reason.

    Analysts only think short term. Tech spawns all sorts of nonsense but saying an item or idea is the next greatest thing, and bigging it up to such an extent there is then near catastrophe when it doesn’t happen, as per the DotCom bust of the late 1990s/early 2000s, as one in the boom and bust cycle, is unhelpful at best and extremely costly to the majority of the public which entrusts investment companies with its savings.

    The analysts, along with market-makers and the other stakeholders such as private equity firms have no idea about tech or shopping or health care, they are only in it to make a profit.  The stock market is purely gambling, using other people’s money and making up the rules as the market dictates, by those in the market. 

    Not many, of the public at large seem to be interested in AI and plenty do not trust it.

    Apple will roll out an AI product, when it’s ready which will be when it’s satisfied the product works as Apple wants.  Apple is very attuned to what its customers want and Apple will create something which fits its customers’ requirements.

    No speculation, no analysts are required.
    williamlondon
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  • Reply 28 of 37
    avon b7avon b7 Posts: 8,338member
    Apple knows exactly what it’s doing and is highly innovative.  It creates fantastic products which are very popular.  It has some successes and some failures. It works on ideas and they either happen or they don’t.

    Huge numbers of people speculate on what Apple is doing and most of the time they are wrong because they are not Apple and don’t think the same way: nor could a single individual or a few analysts ever think the way Apple does, simply by the number of people Apple employs on R and D, let alone any other reason.

    Analysts only think short term. Tech spawns all sorts of nonsense but saying an item or idea is the next greatest thing, and bigging it up to such an extent there is then near catastrophe when it doesn’t happen, as per the DotCom bust of the late 1990s/early 2000s, as one in the boom and bust cycle, is unhelpful at best and extremely costly to the majority of the public which entrusts investment companies with its savings.

    The analysts, along with market-makers and the other stakeholders such as private equity firms have no idea about tech or shopping or health care, they are only in it to make a profit.  The stock market is purely gambling, using other people’s money and making up the rules as the market dictates, by those in the market. 

    Not many, of the public at large seem to be interested in AI and plenty do not trust it.

    Apple will roll out an AI product, when it’s ready which will be when it’s satisfied the product works as Apple wants.  Apple is very attuned to what its customers want and Apple will create something which fits its customers’ requirements.

    No speculation, no analysts are required.
    If Apple will roll out AI when ready and not many of the public at large are interested in it, why did Apple make such a huge deal out of it at that WWDC and then ship a phone without a single Apple Intelligence feature? 

    That alone was telling. As was the fact that so many other iPhones were not able to run it well, including some that were released just a year earlier.


    muthuk_vanalingamblastdoorbloggerblogBlizzard
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  • Reply 29 of 37
    Apple is old and uncool but one thing they got going for them is they make great phones and even greater laptops and computers. 

    That's ok for a tech company. 

    Steve Jobs promoted Tim Cook to CEO because Tim Cook is the money man - he is the reason for Apple's super high profit margins. And thanks to him the company keeps printing money. That's not bad. 

    I personally don't like how they're leaning more and more on services - the iPhone is serving me ads for AppleTV now, and I am sure this will lead to increased revenue in Apple TV serivces, which is why they will do more of it, until iOS is like Windows where they try to sell you stuff everywhere instead of letting me just use my phone please and I don't need or want Apple TV, now, or ever, I've got things to do. 

    But you can't argue with the numbers. Most valuable company with the highest revenues and highest margins, all from making super good phones that are just that notch above the rest. 

    I just got a 16 for my son - he broke our old XS which was working perfectly for him for years. Part of choosing an iPhone over say Nothing Phone (3) is that at the same price level, with the 16 I know what I am getting - I am getting a device that will work great for the next 5 years, easy. 

    At this point at least in my family, iPhone is the tech equivalent of a Toyota - it just keeps running. The quality is something else. Also because they're so popular, getting it fixed here in Asia is easy and cheap - every shop has iPhone model batteries, screens, etc. I cracked my iPhone 11 Pro screen, had it fixed in an hour. Try getting a screen for a 5 year old Samsung etc... that won't happen. 

    Quality is super impressive. 
    muthuk_vanalingam
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  • Reply 30 of 37
    Also contrarian viewpoint - AI on phones may just not be that important. 

    What do we do on our phones every day?

    - Chat with friends - primary use case
    - Chat on work chat
    - Take photos, look at photos, share photos
    - Doom-scroll instagram, X, etc
    - Use some shitty banking app bcause I have to
    - Pay for things with the wallet credit card
    - Use some crypto apps

    That's 99.9% of my use of the phone. 

    See which of these activities are lacking AI? Or benefit from AI? 

    None.

    Most of Apple's revenue is safe from a lack of AI.

    Apple should get into cars and robots though, and use AI there of course. They should drop their silly VR glasses with no use case or no real life use.  
    edited August 3
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  • Reply 31 of 37
    blastdoorblastdoor Posts: 3,871member
    Apple is old and uncool but one thing they got going for them is they make great phones and even greater laptops and computers. 

    That's ok for a tech company. 

    Steve Jobs promoted Tim Cook to CEO because Tim Cook is the money man - he is the reason for Apple's super high profit margins. And thanks to him the company keeps printing money. That's not bad. 

    I personally don't like how they're leaning more and more on services - the iPhone is serving me ads for AppleTV now, and I am sure this will lead to increased revenue in Apple TV serivces, which is why they will do more of it, until iOS is like Windows where they try to sell you stuff everywhere instead of letting me just use my phone please and I don't need or want Apple TV, now, or ever, I've got things to do. 

    But you can't argue with the numbers. Most valuable company with the highest revenues and highest margins, all from making super good phones that are just that notch above the rest. 

    I just got a 16 for my son - he broke our old XS which was working perfectly for him for years. Part of choosing an iPhone over say Nothing Phone (3) is that at the same price level, with the 16 I know what I am getting - I am getting a device that will work great for the next 5 years, easy. 

    At this point at least in my family, iPhone is the tech equivalent of a Toyota - it just keeps running. The quality is something else. Also because they're so popular, getting it fixed here in Asia is easy and cheap - every shop has iPhone model batteries, screens, etc. I cracked my iPhone 11 Pro screen, had it fixed in an hour. Try getting a screen for a 5 year old Samsung etc... that won't happen. 

    Quality is super impressive. 
    I generally agree. Apple makes great computers and phones and that matters. When Zuckerberg talks about smart glasses replacing the phone, I think that’s even more delusional than the idea that the iPad would replace the Mac. 

    The Mac is 40 years old and going strong. The iPhone is over 20 years old and going strong. These are great and relevant products.  Just because Apple is behind in offering a compelling AI product doesn’t mean their platforms aren’t still superior. Access to AI products and services will mostly happen through these existing platforms.
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  • Reply 32 of 37
    macxpressmacxpress Posts: 6,015member
    avon b7 said:
    Apple knows exactly what it’s doing and is highly innovative.  It creates fantastic products which are very popular.  It has some successes and some failures. It works on ideas and they either happen or they don’t.

    Huge numbers of people speculate on what Apple is doing and most of the time they are wrong because they are not Apple and don’t think the same way: nor could a single individual or a few analysts ever think the way Apple does, simply by the number of people Apple employs on R and D, let alone any other reason.

    Analysts only think short term. Tech spawns all sorts of nonsense but saying an item or idea is the next greatest thing, and bigging it up to such an extent there is then near catastrophe when it doesn’t happen, as per the DotCom bust of the late 1990s/early 2000s, as one in the boom and bust cycle, is unhelpful at best and extremely costly to the majority of the public which entrusts investment companies with its savings.

    The analysts, along with market-makers and the other stakeholders such as private equity firms have no idea about tech or shopping or health care, they are only in it to make a profit.  The stock market is purely gambling, using other people’s money and making up the rules as the market dictates, by those in the market. 

    Not many, of the public at large seem to be interested in AI and plenty do not trust it.

    Apple will roll out an AI product, when it’s ready which will be when it’s satisfied the product works as Apple wants.  Apple is very attuned to what its customers want and Apple will create something which fits its customers’ requirements.

    No speculation, no analysts are required.
    If Apple will roll out AI when ready and not many of the public at large are interested in it, why did Apple make such a huge deal out of it at that WWDC and then ship a phone without a single Apple Intelligence feature? 

    That alone was telling. As was the fact that so many other iPhones were not able to run it well, including some that were released just a year earlier.


    Just because Apple pushed it doesn't mean the public wants it. Apple has tried to push things before people didn't care for. 
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  • Reply 33 of 37
    blastdoor said:
    This earnings report in NO WAY proves that people worried about Apple's ability to capitalize on AI are wrong. 

    The concerns about AI are not about earnings next quarter or even next year. It's about 18 months and further out. 

    One thing I'm very confident of -- Apple leadership is not as myopic as the fanboy base. They've known for a while now that they've got a problem, they just haven't solved it yet. One way or another, I'm pretty confident the problem will be solved. But it won't be solved by pretending it doesn't exist. 
    This report absolutely proves that the analysts who cried about this quarter because of Apple Intelligence were wrong.

    Apple will do what it very nearly always does, which is what the analysts in question always, always fail to see -- Iterate until they have something that they like. No visibility as to what Apple is doing does not mean that Apple is not working on it. 

    At this point in the AI lack of maturity, not having a product that really utilizes generative AI is not really an issue. If Apple doesn't do anything in a year or two, then maybe it's an issue.
    Can't say that I agree, the analysts are primarily concerned about 18 months and further out.  AI would fit under the Services category when it comes to generating revenue, if Apple stumbles on it, they could let Microsoft, Google, and Meta all run away with a potential multi trillion-dollar market in 10 years from now.  Did analysts have concern that Apple's AI implementation as of late could be starting to impact sales and were looking to this quarter to see it?  Yes, but their primary concern is what AI is going to be 10 years from now and it doesn't look like Apple is going to be able to keep pace.

    Apple missed out on the cloud, they missed out on the internet search, Microsoft missed out on internet search and its ads, and it missed out on mobile devices, however it hasn't missed out on the cloud, and it isn't missing out on AI and it is paying dividends for them.


    blastdoorwilliamlondon
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  • Reply 34 of 37
    Right now, AI is a gimmick. Until it’s actually useful, it won’t make much impact. As I once read online, on a comment thread: people don’t want AI to do art and poetry so they can do their washing (laundry), they want AI to do their washing/laundry so they can do art and poetry. The Microsofts, Googles and Samsungs of the tech industry are falling over each other to go headfirst in the wrong direction. Let them; Napoleon would. Slow and steady wins the race. As in the nursery rhyme; and the parable: it was the tortoise, not the hare, which won the race; and the guy who took the low road got to Scotland before the guy who took the (glitzy/gimmicky) high road.
    You do realize that the major Tech companies are already using AI to write their software for their applications, right?  You do know that right?  Microsoft, Google, Meta, are using AI to improve the productivity of software engineers.  You understand how expensive Software Engineers are, right?  Generative AI matters when it comes to major motion pictures because it significantly reduces production timelines and costs, Netflix, Sony, Tyler Perry, etc. are already massively starting to invest in AI for making their future movies and TV shows.
    blastdoorwilliamlondon
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  • Reply 35 of 37
    nubus said:
    blastdoor said:
    This earnings report in NO WAY proves that people worried about Apple's ability to capitalize on AI are wrong. 
    This report absolutely proves that the analysts who cried about this quarter because of Apple Intelligence were wrong.
    The report does indeed prove that analysts were wrong about the quarter. Currency tailwinds (likely 2%), tariff scare moving sales forward (1%), access to $42 billion in government incentives from China (MSRP of iPhone 16 Pro dropped 30%!), strong F1 opening, limited negative impact of tariffs, and boost in services.The analysts didn't see all of that.

    But @blastdoor is right in the sense that AI is holding Apple back. While Apple delivered 24% growth in services then MS hit 34%. Microsoft is also less exposed to tariffs. The series of strategic blunders and product misfires from Apple caused this, and the quarter just expanded it to nearly a trillion gap.

    And Apple might be heading towards another strategic miscalculation. Apple is trying to keep AI on-device. It will increase the cost of devices and expose them to tariffs while the quality of AI on-device remains limited by storage, battery, memory, and processing power. MS is mostly doing AI as services delivering tariff free recurring income with constantly updated models.

    Apple is betting on on-device to the point where we have a datacenter gap (thanks Dr. Strangelove). The Environmental Progress Report from Apple is showing 6.7% growth in data centers from 2023 to 2024. Microsoft is growing 33% per year (both numbers based on energy consumption). This gap can define what Apple is capable of doing when looking ahead.
    This!  This!  This!

    I would love to see Mike Wuerthele's response to this.  

    This is exactly the issue Analysts have!
    williamlondon
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  • Reply 36 of 37
    blastdoorblastdoor Posts: 3,871member
    blastdoor said:
    blastdoor said:
    This earnings report in NO WAY proves that people worried about Apple's ability to capitalize on AI are wrong. 

    The concerns about AI are not about earnings next quarter or even next year. It's about 18 months and further out. 

    One thing I'm very confident of -- Apple leadership is not as myopic as the fanboy base. They've known for a while now that they've got a problem, they just haven't solved it yet. One way or another, I'm pretty confident the problem will be solved. But it won't be solved by pretending it doesn't exist. 
    This report absolutely proves that the analysts who cried about this quarter because of Apple Intelligence were wrong.

    Apple will do what it very nearly always does, which is what the analysts in question always, always fail to see -- Iterate until they have something that they like. No visibility as to what Apple is doing does not mean that Apple is not working on it. 

    At this point in the AI lack of maturity, not having a product that really utilizes generative AI is not really an issue. If Apple doesn't do anything in a year or two, then maybe it's an issue.
    Who were the analysts who expressed concerns about apples performance in the most recent quarter due to AI?
    As briefly addressed in the piece, Wedbush's Dan Ives said Apple had to announce what the specific plan was at WWDC, or the quarter would be terribly bad. Just about everybody complained across the quarter minus Morgan Stanley that without improved Siri, there was no reason to buy an iPhone 16 at all.

    Turns out, that's not what happened.
    Still no link to substantiate that claim, which makes me think you don't have one. 

    There were plenty of concerns about the quarter due to tariffs and China, but not AI. The concern about AI is in the future. I don't see what advantage there is in making stuff up like this. It just seems silly. 
    williamlondon
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  • Reply 37 of 37
    Mike Wuerthelemike wuerthele Posts: 7,235administrator
    blastdoor said:
    blastdoor said:
    blastdoor said:
    This earnings report in NO WAY proves that people worried about Apple's ability to capitalize on AI are wrong. 

    The concerns about AI are not about earnings next quarter or even next year. It's about 18 months and further out. 

    One thing I'm very confident of -- Apple leadership is not as myopic as the fanboy base. They've known for a while now that they've got a problem, they just haven't solved it yet. One way or another, I'm pretty confident the problem will be solved. But it won't be solved by pretending it doesn't exist. 
    This report absolutely proves that the analysts who cried about this quarter because of Apple Intelligence were wrong.

    Apple will do what it very nearly always does, which is what the analysts in question always, always fail to see -- Iterate until they have something that they like. No visibility as to what Apple is doing does not mean that Apple is not working on it. 

    At this point in the AI lack of maturity, not having a product that really utilizes generative AI is not really an issue. If Apple doesn't do anything in a year or two, then maybe it's an issue.
    Who were the analysts who expressed concerns about apples performance in the most recent quarter due to AI?
    As briefly addressed in the piece, Wedbush's Dan Ives said Apple had to announce what the specific plan was at WWDC, or the quarter would be terribly bad. Just about everybody complained across the quarter minus Morgan Stanley that without improved Siri, there was no reason to buy an iPhone 16 at all.

    Turns out, that's not what happened.
    Still no link to substantiate that claim, which makes me think you don't have one. 

    There were plenty of concerns about the quarter due to tariffs and China, but not AI. The concern about AI is in the future. I don't see what advantage there is in making stuff up like this. It just seems silly. 
    FWIW, I try to not work on the weekend.

    Anyway, there's a reason we used Ives from Wedbush in the piece.

    So, a backstage tip for AppleInsider is one of us has CNBC on all the time. It helps with market-breaking stuff, like tariff applications and the like. Ives is a frequent guest on the morning show, and the lunchtime panel, and has been beating the drum all year that second quarter would be bad, and when that wasn't he shifted his target to the third quarter, because Siri was postponed. He's kept going on with the iPhone sales would suffer this year, because, you know, Apple Intelligence. And tariffs.

    I'll see if he said it in a note, but he constantly went over it, again, and again. I will admit, it is a very low priority on my work list. Another forum-goer posted you many, many links, with several of them talking about this last quarter.

    I understand my comment irritated you, but it really wasn't the point of the piece as a whole. You're welcome to disagree and not like it, and I enjoy your points you've made, but the piece will not be altered. William was right. 
    edited August 4
    muthuk_vanalingamwilliamlondon
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