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This is Bloomberg Business Week with Carol Masser and Tim Stenovak on Bloomberg Radio.
I want to get to some earnings because we're seeing some stocks move here in the aftermarket. Intel shares they are right now up about two percent. This is as we got in terms of some of the big headlines from Intel C's first quarter. Justin gross margin of thirty six percent, that's below with the Street was forecasting of
about thirty nine point three percent. Go back to the fourth quarter, the last quarter revenues that was a beat fourteen point twenty six billion versus an estimate of thirteen point eighty one billion. And again talking about first quarter revenue, some forecasts here a bit of a range eleven point seven billion to twelve point seven billion, and that Tim compares with the street estimate of twelve point eighty five billion. But again right now we're seeing Intel up about two percent.
I know they also talked about in terms of some spending right and I think basically saying they will not be spending speculatively. So I feel like some of that plays to maybe some of the commentary we've had about the AI spend maybe a rethink this past week.
Reminder too, they're also looking for a new CEO at this point to take up for patkel Singer who left at the end of last year. For more, let's go to Jackie Doavolos. She's in our San Francisco bureau. She's been following this company and these numbers closely. Jackie, how is the turnaround going?
Well, that's the question everyone wants to know. The key uncertainty here is who's taking over the company. You had some guidance from the CFO as to how the next quarter is going to look like, but not so much guidance on who's going to be taking the reins. And I think that's the big point of uncertainty. And if you look at shares, it's kind of a tepid response considering how much uncertainty is swirling around the company right now. But to your point, Carol, I think some of that
optimism is coming in through the comments around spend. As you know, the former CEO, Pat gal Singer was ousted just last month, and big part of the reason for that was this ordinate amount of spending that the board perceived to be a drag on the company's performance. Now, we might not know who might be taking over, but what we do know is that next quarter they're looking at revenue of about eleven point seven to twelve point
seven billion dollars. That's below estimates, but perhaps some of that optimism from the fact that they beat pretty well on their revenue figures for the fourth quarter is coming through.
Yeah, it's interesting just looking through to some of the reporting from Ouroni and King of course, who follows the chips sector, and saying that you know, again, what you guys were just talking about investors in analyst waiting for the appointment of a new leader who will determine Intel's future. I mean, it's a big question. The company's outsource manufacturing push will not see meaningful revenue from silicon customers until twenty twenty seven. For now, the bulk of outside sales
will come from packing works. So we're getting a little bit more in terms of the business here, Tim. But again, the stock, as Jackie mentioned, just pulling it up again here in the aftermarket, and the stock right now just up about one point two percent here. But it's not selling off, which is interesting.
I mean, there's been a lot of selling off of the last few years with Intel to you know, when you zoom out, of course, Jackie, the data center business certainly facing competition from Nvidia and AMD their core business PC processors. How is demand there, how's competition there?
Well, we got some comments from the CFO who said that competitive dynamics is a big reason why we're seeing a bit of a weaker forecast. He also cited the macro uncertainties and of course seasonal weakness. But when we go back to those competitive dynamics, who is the competition and tim You're absolutely right, those AI accelerators are the big question for investors. Can they get in here and compete?
Obviously with the gold standard coming from Nvidia, it's going to take a lot of work and investment to really chip away there. But in the meantime they're also facing competition from their bread and butter in that processing personal computer processing unit. You have AMD really coming in, and then of course on the outsourcing manufacturing site, Taiwan Semiconductors is also a pretty big player now, so they're kind
of facing this competition from all ends. Even you know, as we look at AI being this big opportunity for pretty much every tech player out there. Intel has really been struggling to make a name for themselves in the space.
Just to rehash, Intel shares folks in the aftermarket up about one point three percent. Going to the first quarter forecast seeing revenue of eleven point seven billion to twelve point seven billion. The estimate on the street is twelve point eighty five billion, so above that. Also in terms of forecasts, he's an adjusted EPs of just flat. Estimate is for eight cents. He's a justin gross margin of thirty six percent. That's a miss too. Estimate is thirty
nine point three percent. Go back to the fourth quarter and their current quarter sales and profit forcat asked falling short of analyst projections. But if we go back to the fourth quarter fourteen point two six billion, that's the revenue that's down seven point four percent year over year. The estimate on the street was thirteen point eight billion. But again the key thing as we're talking about, you know,
not yet having any update on a permanent CEO. The interim co CEO David Sisner saying our first quarter one or quarter one outlook, I should say, reflects seasonal weakness magnified by macro uncertainties. Further inventory digestion, and competitive dynamics. Jackie sounds like a super full plate. We know it's been a full plate for Intel, but it still is. It's a reminder at least that it still is.
One hundred percent. And as we look to the conference call with analysts, the big question is going to be not just an update for leadership, but also in this interim, what's the game plan here, because now that you're seeing kind of spend really being scrutinized after the deep Seek drama earlier this week, it's sort of effect those who might have been perhaps exempt from that kind of scrutiny before these open you know, AI, other AI developer kind
of players out there, and so obviously this is nothing new for Intel, but of course I think that might be you know, some of the guidance that they want this this conservative spend, What does that mean, How does it look like in practice at a time when it is going to take investment to really kind of break
into this AI space. Another thing that we'll be looking out for in the conference call, it's just any more guidance around what the company plans to do to perhaps offset some of the weaknesses in its bread and butter business in these personal computers. You know, what, what does it plan to do about this kind of new competition coming from Taiwan Semiconductors. I think That's what I'm going to be looking out for in the upcoming call.
I think what still surprises me, Jackie is this is a company that has no full time CEO, and you had Pat Gelslinger out earlier this week. We talked about this with Ian King tweeting that he was buying shares of Nvidia during the down during the decline of Nvidia on Monday, he wrote about that on LinkedIn, and it was surprising to see that I'm not, you know, here to talk about Gelsinger. What I am wondering from you about is what are analysts saying about the type of
leader who could come in and turn this company around? Like, who are the names? Do we have names that are being thrown around at this point? Do we have a timeline, what do we know?
I don't think there's too much that we do know other than you know, the big point of scrutiny has been spend and if you're going to bring in a leader that can kind of articulate a new vision for the company still kind of, you know, bring it something that's forward looking, that is not going to be predicated on a plan that is going to take, you know, five to ten years to pan out, because I think what investors want to see is what can we do
with what we have now? And you know, obviously a pet Elsinger didn't get to live out his full five year plan, but you know, he did put in in place a solid foundation that I think a new CEO can can work with. So some of the notes that we've been seeing from the street include, you know, what can be done with what foundation currently exists?
Because it's not nothing.
You know, some solid investments have been made, some good inroads have been made, but I think it's just a matter of kind of that conservative spend how far can that take them?
Hey, all right, Jackie, thank you so much. Jackie Devallas, Bloomberg News Tech reporter joining us with the latest on Intel. Keeping a watch on it as it moves up just
a little bit in the aftermarket. Do you want to mention KLA Corp. Semiconductor manufacturing equipment company up about four and a half percent in the aftermarket following its earnings, looking at what the company has to say, second quarter adjusted gross margins sixty one point seven percent, slightly better than the street expected third quarter adjusted gross margin, so looking towards the current quarter sixty one to sixty three percent.
Also talking about third quarter revenue, they're looking for two point eighty five to three point fifteen million billion, excuse me, and that is better than the street expected. So that explains where you're seeing this stock up. Do not go anywhere. Apple to come in just a moment. The earnings continuing
to come out. We are awaiting Apple, which is set to report in just about seven minutes at the bottom of the hour four to thirty pm Wall Street time, So as soon as they cross, we will bring them to you. A reminder of the company. We'll report for the quarter despite some head wind stepping from China, the slow rollout of in house AI future features. So there's a lot coming at us when it comes to Apple in particular, a lot coming at us when it comes
to the whole tech sector. This week, Angela Zino is senior equeritly alyist over at CFRAA. He joins us from New York City. Angelo, I do want to start with Intel because they just came out certainly a big part of the semi second, but they're also going through, of course, some changes, waiting for a new CEO, new leader, a new way forward. Initial thoughts on Intel.
Yeah, now, thanks for having me.
So, you know, you kind of look at the results overall, and I would say they were okay. I mean, as far as the results were concerned, I think earnings about thirteen cents, sales were down seven percent, roughly kind of in line where we were expecting. I think as far as the guidance is concerned, it was definitely on the lighter side of things, but you know, nothing abysmal, nothing like we've seen in past quarters where they've kind of
missed by a much wider margin. So as far as kind of the results are concerned, I think it was perfectly fine, you know, within kind of you know, segments wise. I think the client computing group, which is kind of more their their PC business was down about nine percent, and when you kind of look at their data center business down about three percent. Again, I mean, it was
kind of where we had expected largely. So yeah, I mean I think it's one of those situations where this company is kind of just kind of going through the motions, and we're just kind of waiting to see kind of who that next CEO is going to be and what they have to say on the call as far as kind of cost cutting this concern here in the intermediate term, I.
Could have asked you the same question I'm going to ask you Angelo anytime over the last three years, where is Intel in its turnaround?
You know, it's it's a it's a tough one because, yeah, there they continue to have to kind of restart in terms of you know, where they're at, I mean you and and it's typically because of the fact that they haven't really kind of given you know, the existing leadership team, you know, enough time to kind of you know, watch their vision to really come to fruition.
I think right now where we're looking at is you know, you need you need a new CEO.
I think when you kind of look at their core business, it's really kind of under attack. Right on the PC side of things. You hear things like you know, ARM looking to take half the half the market. On that side of things, you got got the kind of greater competitive pressure.
Going on there.
You kind of look on the data center side of things, they don't have the right offerings there. I mean, CPUs are kind of a thing of the past at this point in time, and you've got you know these you know, these hyperscalers out there kind of rolling out their own CPU offerings. So it is it is a very difficult time for Intel at this point in time. There's really kind of no direction. You need that direction. So the faster you get a CEO.
The better.
Again, this is kind of almost a race to the bottom, it seems like right now in terms of kind of continue to continuing to course as their revenue trajectory continues to go down. I think really kind of if I'm looking at this company, it's all about how they can
execute on the foundry side of things right now. If you're thinking about a turnaround going into the second half of the year, I mean, you've got eighteen A that's that's kind of been long awaited and hyped up panther Laics, it's supposed to ramp here in the second half of the year. We want to see kind of what kind of customers like, you know, start ramping on that side
of things. You're not going to have a major hyperscaler out there all of a sudden just give business to Intel, they need to kind of execute on that side of things. So that's where we're at right now. I think they need to start show some sort of promise on the foundry side of things, and hopefully they can kind of gain some momentum from there.
I got to tell you, I get these emails on the terminal when stories are read at like a high rate, those read spikes. People want to know about Apple. It says that to Apple that our live blog on Apple Carol is already hitting a red spike before those numbers come out. We're expecting those numbers in just about two minutes. Angelo, China, is that the biggest concern? We saw some downgrades the early part of this year.
Yeah, I mean it seems like, you know, when you kind of look here over the last couple of years, January just hasn't been a good month for Apple, and you know, you can kind of say maybe a part of that is seasonality and what have you. I think obviously the other issue is you kind of look over the last two three years, the competitive pressures have.
Definitely escalated out in China.
I mean, Huawei has become you know, a real threat again at the high end of the market, and you know, we kind of want to know what's going on with China. It's somewhat of a black box at this point in time, and you kind of look at some of the sell through numbers that have been posted, you know, specifically by the Chinese government here late in the year.
The numbers don't look good.
And I think most people realize that most investors are kind of going into these numbers knowing that China or expecting that China is not going to be good. The question is how bad is it? You know, we are we kind of going to have to deal with some sort of excess inventoryous situation where they're going to start discounting more than we expect and it's going to, you know, look like an ugly March Quarter in terms of the guidance, I think that's at this point what we're looking at.
But in terms of the biggest risk kind of going into the print here and as far as the March Quarter is concerned, it's absolutely China. And we also know as far as the March Quarter guidance is concerned, it's going to be someone on the weaker side of things because of the four X uncertainties, you.
Know, Angela. We're just about forty seconds away from those Apple earnings. Stocks down about five percent. We know it's been lagging some of it's tech brethren. If you will, question is kind of what's next for Apple? What could they say today that might give some indication of what's next. They've started to give some clues. Just got about twenty seconds here.
I think the hope is that you get a better than fear type number really on China. I think that's kind of the big thing. And then of course on the services side of things, you want to make sure that that's running on all cylinders. We're going to hopefully continue to get double digit growth. And I think if you can kind of get you know, those two kind of things running, I think that should be enough as far as kind of where the stock is at and the pullback that we've seen.
All right, folks, we're talking with Angelo's, you know, senior equity analyst over at CFR Research. He's going to stay with us as we get ready for those Apple earnings and they are crossing. So let's go through some of the numbers. First quarter revenue one hundred and twenty four point three billion. That is just a hair better than what the street was expecting. One hundred and twenty four point one billion is what the street was looking for.
Products revenue ninety seven point ninety six billion, that's up about one point six percent year over year. Ten that's a little bit light. Ninety eight point zero two billion. You break it down. iPhone, the all important iPhone number, sixty nine point fourteen billion, that is down year over year. Estimate was for seventy one point zero four billion.
And then you keep going down at China revenue, big miss there, estimates for twenty one point six billion dollars that came in at eighteen point five to one billion dollars. Wearables, home and accessories coming in just shy of estimates. MAC revenue coming in above estimates, iPad revenue coming in above estimates.
First quarter products revenue coming in shi of estimates. But Carol, what we're talking about right now, iPhone revenue coming in light sixty nine point one four billion versus estimates of seventy one billion, and that China number significantly lower than analysts one to see coming in at eighteen point five to one billion.
Apple also maintaining its cash dividend of twenty five cents a share. I should say the stock has been bouncing around in the aftermarket. We've seen it up about one percent. Right now, it's just up about six tenths of a percent of half a percent. Angelo Zeno come on in initial thoughts on the first headlines off of this earnings release.
Yeah, I mean, I think this is kind of a situation where, you know, execution was I think as good as you could have asked for. I mean, as far as the top line is concerned, roughly in line. I think the expectation again was about you know, one hundred and twenty four billion, so you're looking at what was it maybe three point eight percent or close to four percent growth, let's call it, as far as kind of
on a year of a year growth rate. And I mean, I think Tim kind of highlighted the iPhone numbers were definitely a disappointment and the China numbers, so it's definitely a China iPhone problem as far as the quarter is concerned,
and why we missed. And again, the expectations going into the quarter was it was going to be a challenge, and the fact that they had been able to kind of navigate and still meet the numbers despite those issues, I think kind of helps maybe do you risk the stock at least when you kind of look at the numbers this quarter. I mean, we'll see what the March quarter guidance is going to look like. But my guess is you're going to continue to see the further weakness on the China iPhone side of things.
Angelo, how much of the iPhone miss can you attribute to China? Is is the iPhone miss just a result of China?
It seems like it, to be honest with you, just kind of giving just given the high level numbers that I'm hearing from you, it just seems like the weakness is.
Really kind of you know, all China.
And you know, my guess is, you know, Western markets probably held up much better what held up as as to.
Be expected, and and you know, we kind.
Of saw, you know, some pronounced weakness on the China side of things, and again not a surprise because a lot of the sell through numbers that had you know, come out from China, you know, was looking you know, essentially it was kind of pointing towards double digit declines out of kind of the eye phone business. So that's essentially what you've got. So it's it's pretty brutal, but not necessarily a complete surprise given some of the indications we got going into the numbers.
All right, the three bright spots, iPad, MAC, and services. The iPad and MAC. The year over year services is at an all time record. What's interesting too, all time revenue record too as well, one hundred and twenty four
point three billion and narrowly beating Wall Street estimates. Again, a huge miss for China when it comes to Apple eighteen point five billion versus twenty one point six billion that Wall Street expected, and a big miss for the iPhone sixty nine point one billion dollars versus seventy one billion dollars expected. And you know, initial reaction Angelo in
terms of the share price. Initially we saw pop and then we saw the stock move down just down to here a hare at this point, you know, a lot of when we talk about Apple is we are saying what's the next big thing? Right and certainly if the iPhone is you know, certainly shoring business a still a very big business. But maybe some questions about China growth going forward. But where do you want to see the company move into? Where are the new opportunities in your view for Apple.
Yeah, I mean, listen, I think, you know, we need to continue to see good growth on the services side of things, and then to continue to innovate and come out with new offerings on the services side of things. And I think that business will naturally continue to grow due to a number of factors. But you know, as far as kind of what we're looking for here over the next couple of quarters, I don't think you should forget about Apple Intelligence. I think that's still a very
important part of this story. We've kind of seen the first two trunches of Apple Intelligence really roll out. The first trunch well, you know, was really a non event. I actually think, you know, and I have the iPhone sixteen. I actually really liked let a number of the other upgrades on the second trunch out there. I mean, I
use kind of visual intelligence all the time. Not crazy about gen moji's and what have you, but you know, I think there were a number of decent features out there, specifically on the visual intelligence ide thinks I think Grounds was great. I think the chat, GPT and integration is super helpful for someone that just kind of you know, looking to do stuff, you know, on the fly on
their phone. So I just don't think the consumer is well aware of it obviously, and we're still at a point where you know, most of kind of the installed base doesn't have access or even knows about Apple Apple Intelligence at this point in time. We'll get kind of the the third you know, trunch here in the coming months, and I think that's really going to help in terms of the serie integration and what Apple can kind of demonstrate across kind of the app store and what have you.
And then you know, clearly, you know, we kind of want to see how that reflects across the rest of the ecosystem as they kind of throw this out internationally, what kind of partnerships they can kind of announce out
in China. Does that make a difference in China in terms of kind of helping the demand outlook, because I do think a big problem with with Apple right now in China is the fact that they don't have AI capabilities where you know, obviously they're they're China peers do don't have a full device out there where their peers do.
And hopefully, you know, we see something on the foldable side of things here over the next kind of two years, So you know, where I'd like to see them go is kind of, you know, start evolving their ecosystem where they could find some success, at least in China, because at this point in time, you know, what they've got in terms of their offering in China is just not going to.
Cut it all right, Going to leave it on that note, Angela's you know, he's senior equity analyst at CFR Research joining us in New York City. Do you want to mention Tim Cook? In the earnings release and the statement called it the company's best quarter ever at Apple. He also said, through the power of Apple Silicon, we're unlocking new possibilities for our users with Apple Intelligence, which makes
apps and experiences even better and more personal. We're excited that Apple Intelligence will be available and even more languages this April. So Tim is certainly choosing to highlight that we should point out. Apple shares though after an initial pop right after the earnings release here in the aftermarket, are now pretty much flat.
Yeah, no mention of China in that statement, which certainly will be a focus of investors on that call when it does begin in just a few minutes. It's certainly a focus for Caroline High. She's a Bloomberg Technology co host. She joins us here in the Bloomberg Interactive Brokers studio. Two big misses today Caroline highphone revenue coming in about two billion dollars shi of estimates, and then greater China revenue coming in about three billion dollars shi of estimates.
Does Apple need to change its strategy in China? Or do investors need to adjust their expectations about China?
Do we need to get more comfortable with their selling fewer phones but in a higher average selling price. And I think that's perhaps where they're trying to educate people towards.
Is that in China?
Is that everywhere?
Well, I mean it.
Feels like everywhere, but we do still have the slightly cheaper phones that are available in the US, but we don't have the rampant sort of competition that you do have with a Huawei and with some of the local operators that are in China that are just managing to produce far more sophisticateated phones and a much lower price point. And also there's some national patriotic fervor that's going on and wanting to buy your locally made phones. So they
have been educating us and I think counterpoint research. For example, front run the fact that they're going to have had a dismal general amount sold eighteen percent rejection they thought in terms of phone sold, But if the average selling price is picking up, you're not going to be hurting quite so bad. But look, ultimately we've seen it's a
big miss. They're growing in every region outside of China, and even the America's Japan was pretty good, but really China has been that real weak point, and we have to perhaps see that the company is just going to try and retrain us to think about them as a services company, as an Apple Intelligence company. And look, with iPhones missing as well, maybe we have to start to think is this really always going to be the juggernaut we thought it was?
What about Apple Intelligence? Right? We have certainly heard so much from the company, Tim Cook singling it out also on the release and in a statement, So how is the world thinking about Apple Intelligence and its opportunities?
I mean, what what that's far?
I mean, of course I want to have fun in a Gen Moji, but ultimately I'm going to be upgrading my phone for that. No, I probably have gone ungraded to an iPhone sixteen because my darn camera is broken and I want to get a better camera, and I
want to get a slimmer phone. But I wouldn't have gone for it for Apple Intelligence largely because look, I can integrate Google and to upgrade there and have it magicing my emails and making life a little bit more sophisticated there, and compared to Samsung, it is not able to innovate in the way that Samsung's adapted to Alphabet's offering Open Ai. Though, I think the winning formula for Apple Intelligence going forward is that it hasn't spent billions
on its own large language model. It's gone in bed with open Ai, and open Ai is probably gonna have to get a lot cheaper because of what's happening with Deeze.
Caroline h Have you been watching Severance?
No?
I haven't.
Okay, Well, I'm.
Too busy on the jacket, holl the day of the Jackal.
It's it's a huge investment by Apple, huge marketing, push services revenue a bright spot for the company. Yes, coming in at twenty six point three four billion dollars, it's for twenty six point one billion. I bring up Severance because that's part of the services category. This is a high margin business for Apple, the services social TVs TVs. But the services category. Yeah, does does services growth and strength ever offset weakness in China or for MyPhone? Well?
I think it's interesting. Then the new COFO who has just taken on the role. He's a long time Apple executive, but he's just taken on the role in January, is really talking up about sort of the installed base, because that's where they want you to think the amount of max iPads phones that we all own. They say that we now have an installed base of active devices that reached an all time high across all products and geographic segments.
Suddenly the services bigot wheel just flies. And then when you're getting into payments, when you're getting into interoperability, of course, services just becomes ever more necessary.
For I mean, I probably pay Apple more each year between between the memory.
Yeah, what about the app store?
I do wonder with some regulatory perspective, we heard it from Microsoft yesterday, Well was it Meta yesterday talk.
Singling out EU.
But how much are they going to have to change the business model when it comes to the revenue They can just skim away from an app store when it think about how it's treating its own consumers and whether we're being fairly treated across the world.
I mean, what do you want to know and what do you want to hear from them?
On the car?
Is it just China or is it other things?
I think, what is your next big innovation? Is it about the home?
Because look, the Vision Pro looks cute, but are we all spending thousands on it? No, it hasn't been the R and D winner for them this yet, but it might have spin offs when they can tell about how much they've iterated there to bring it to what they're going to do with the home, the video screens, the robotics. We're going to see how they can become evanmore integrale.
We need another winning product. It wasn't cars, the Vision Pro, not yet, But what about twenty twenty five is some new unleashed hardware.
I'm amazer not more entrenched in the home. I mean, I know in my home it's such an Apple household, but it's not.
We're a Google home household.
We are too. We are too, and so I'm kind of amazed that they have kind of waited so long to get into the home market.
Yeah, it would be certainly that would be an interesting product category from them. What about something more akin to metas glasses that we spoke about yesterday, and if they were to come out with something that is less vision pro oculous and more sort of like low profile Rabia, because that.
Was the irritation for many.
Was it the fact that you've basically got a huge battery, we connected to you and it just.
So harding around.
The tried and tested formula of Apple is let everyone else play and then you come in and win the day with something beautiful sneak and everyone jumps on board. So maybe that is the winning formula for the home and when it will be for glasses and they'll start to dabble in.
I mean, Tim Cook's got nice pair of glasses.
I wonder if he wants to start making them and we suit you down to the ground, Tim, But I do think that they do. They're always going to be slightly slower off the mark. Then come and bring in what it. They haven't got a foldable phone yet. Look, Samsung has plenty on the market. Everyone's been wanting to get a smaller form factor. They're just waiting until they can perfect. So you don't get a crease in it. So I do wonder whether it's gonna take a little bit of time.
You know, we have talked with Mark I guess about just how the overall market here in the United States is so overweighted to some of these big tech companies. And I am curious though they are important, right when you look at kind of the numbers that they bring in, how twenty four million, I mean, it's just extraordinary, even when we say right, maybe right, it's extraordinary. So how are you thinking about this week of some of these big tech names and the results that we've had.
Thing they've done all right, considering Monday and the deep seeky whiplash that we had, and I thought the spend.
Would be so much more under consideration.
But I think Satia, even though Microsoft saw a big hit today, Satia managed to sort of thread the needle that look, we're already offering our one on on our foundry, IAI foundry, come to us find the best models. We'll also be able to we have our issue as supply, we've got to continue to invest. So they managed to vindicate a spending. I think Meta did a phenomenal job of just talking up with such pompous, like grandiose ideas that.
Won everyone over.
You know, musted the same, the fact that actually the numbers look pretty ugly. But he's so optimistic about Optimist, he's so optimistic about FSD that we managed to be blindsided by the idea that actually the plans are there, the money is being well spent, and we're still committed to these companies. So ultimately, I think they've managed to navigate a pretty rocky period Apple. The fact that it's flat Microsoft's been really the only real pain point here.
St Micro had another problem ever in Europe as well. I look towards Alphabet and Amazon. Can they vindicate the amounts of money that they're going to have to save.
I'm not going to put words in Mark Umman's mouth, but he spent plenty of time over the last few months on our program really criticizing Apple for.
Its AI is and it's analysts.
He loves to criticize the analyst.
AI and you know, a question about slow rolling AI and to what extent this actually is something that's not just incremental but is actually meaningful. When do we start to see Apple intelligence really flourish.
I think they're signaling it signaling in the even the press release saying that more languages are coming in April, we will be making it further integrated. It's also interesting when they bring these things without us even knowing, like the news that they brought starlink and the fact that we can now use with it, they just hide in these little operating system grades.
So example, publicly acknowledge that, I know Mark Grimman reported that it was.
Going to happen.
I think T Mobile CEO came on and talked about it, and it's just that ultimately they do slow roll. They don't perhaps they realize that they need to speak to the investor.
Base about intelligence.
They're going to talk about how they're really managing to infuse it in a more seamless manner. But to you and I as a consumer, I think they just don't want to stress test it too much. They want to slowly have us naturally absorbing it and making our life simpler and simpler. But thus far, like a little summari of my email hasn't changed my life.
All that much.
Yeah, exactly. I just want to remind everybody that we do see Apple shares fluctuating in the aftermarket. Apple as our Mark German Reports posted sales that were slightly better than analysts estimated, even as the iPhone and sales in China were weaker than anticipated. Caroline, just talking about that revenue number, it did rise four percent to one hundred and twenty four point three billion in the fiscal first quarter.
Analysts had estimated one hundred and twenty four point one, so, you know, coming in just a hair better than what the street was forecasting. But again concerns over China and Apples struggling there stacks up about four tenths of a percent here in the aftermarket. Yeah, I just think, you know, it's interesting to see after what a crazy week that we've seen. I feel like with technology that the stock is just kind of flat.
Yeah, we priced it in, and remember great point, it was kind of beaten up running into this. We'd had five analyst downgrades right in the last month or so, and unlike in Nvidia that has zero cells, there have been a few creeping into Apples, So I think people had started to price in the China weakness.
Interestingly made the point to.
Like all the going to sell us cheaper price points they are, according to Mark Gumman, going to be focusing on the iPhone SE, which is the cheaper around five hundred dollars offering that's going to come in April March. Maybe that's going to pull more people perhaps away from the Samsung's and the Android offerings. Maybe we get the cheaper, lower end Airpod's making a dent. But all of this
I think had just been guided. We knew that Apple was going to have a terrible time in China, and Apple Intelligences isn't there yet, and people have really been complaining about the latest os, like use cases, the way in which the phone just doesn't feel as slick.
As it used to.
Are we going to start hearing more chatter about Tim Cook and a succession plan. We've been talking a lot about Intel and what Intel does post Gal Singer, and.
They've got some big issues they do.
Tim Cook has been an Apple since nineteen ninety eight, he's been CEO since twenty eleven.
What's the succession plan?
And they've just had a CFO come into the MITS who's been trained up from within. I don't think anyone feels that Tim's going anywhere soon. He navigates the first Trump administration so swiftly and seamlessly worked well to be able to protect his business that of course is so dependent on China, not just from a selling perspective, but it's more from a production perspective. What do tarifs mean
for him? So I think in this next administration can't I wouldn't ever bet that he's going to hand over the baton anytime soon. But I think that is a key question that people are gonna be asking who from within has been groomed up, because.
Remember they lost a lot of talent as well.
Johnny E's left, and a lot of people seem to move from the engineering the product development side of things.
All right, fascinating stuff, Caroline, thank you again. Second day like making anyways sense of all the big tech earnings. As we said, Caroline Hyde is co host of Bloomberg Technology on Bloomberg TV. Catch It. They'll continue coverage of all the earnings this week. That'll be at eleven am Wall Street time tomorrow on Bloomberg TV. Right now, tim Apple shares just down about one quarter of one percent.