Gene Munster

Reading between the lines on Cooks response to a question aabout when Siri AI will be approved in Europe and China. He said they're making progress but they're still at the "front end with more work to do to". My take: I bet we're six months away from Europe approval and more than a year for China. Those two segments account for just under half of revenue, and mean any lift in Siri AI revenue will be staggered. $AAPL

Cook said there are other "enormous opportunities for Apple in AI. Excited about Siri AI, and the ability to run some percentage of requests on device is strategic and a competitive weapon" My take: The meat of Apple's AI opportunity over the next couple of years is the new Siri AI's ability to power to an upgrade cycle and bring in new users because it would be AI that just works. Other new "enormous" opportunities that will be opened up because of inference on device is likely something on wearables and an AI first device. $AAPL

Cook adds helpful color about why supply constraints will be more significant in September. Cook says iPhone 22% and Mac 29% growth in June was much better than expected so they pulled supply forward into June from September "and will have one quarter that they will be scrambling for supply". My take: I believe Cooks take. While the Street was modeling for iPhone (half of revenue) to grew at 21% in June, the company guided for closer to 17%, and 22% reported is higher than 17%. As for the Mac (~10% of revenue) definitely was better than the 8% they expected, finishing up 29%.

Cook on the new Siri beta that's been our for three week is that its "really really great", and "could not be more excited about where the product is" My take: Thats to be expected.

The $AAPL guide is not as bad as it first looks. Stock now down 8%, at after-hours lows. Bottom line: Doing the math, if not for FX and supply constraints, I believe the September revenue guide would have called for up 15% yy in September vs Street at up 12%. Here's how I get there: * For September the Street was at 12% growth. They guided 9-11%. * Cook says the supply constraints to increase significantly in September. The "significantly increase supply constraints" will hide what the underlying demand actually is. * FX was a 2.5% q/q negative impact to growth. * Adding back the FX was 2.5% gets us to 11.5% and 13.5%. They typically co…

$AAPL guide was soft because of supply constraints and 2.5% qq FX growth headwind. Guided Sep revenue up 9-11%. Street was at 12%. Adjusting for FX it would have been up 11.5%-13%. Investors don't care why the guide is lower (FX and supply are not long term issues), they just want it to be lower.

Cook says Apple has created the world’s best consumer hardware to experience AI. My take: I agree and expect a consumer hardware upgrade cycle in 2027-2029 driven by personalized AI.

Cook says Mac had significant supply constrains and grew at 29%. Would have been better. $AAPL

$AAPL was overall slightly better than expected, which explains why the stock is down 2% in after hours. iPhone up 22% vs. Street up 21%. Now we have to wait for the guide in about an hour. I I expect they will maintain or slightly raise overall revenue for September vs Street at 12% yy. which would be a big win. That up 12% yy guide would be stronger than it looks given they will likely split the iPhone upgrade timing over six months, which makes for a difficult comp in September.

Outside of Sept guidance, the key question is will $AAPL give investors confidence that they have the chops when it comes to AI? On the call I expect Cook to say the new iOS27 beta with Siri is going great, and I believe investors to shrug those comments off because of course they will say it's going great. I can add I've been using it for three weeks and it's a major step forward, but it's still in beta. What matters is any update on the timing of when the new Siri will come out of beta, or at least remain in beta but available to everyone as a standard update, similar to what they have done with Apple Intelligence (it still shows its in b…

I think $AAPL will guide September revenue inline to slightly higher than the Street. That outlook will be impacted by two new forces, a headwind of the likely shift to a staggered iPhone release schedule over the next six months, and the tailwind of the price increase. I expect the net of those should results in the overall revenue guide for September to be inline to slightly better than the Street, which now sits up 12% y/y. My optimistic outlook may come across as aggressive considering the high bar, with the Street looking for 21% iPhone growth in June, and 18% in September, compared to the segment that was up on average 2% per year fr…

We got the 7% pop on an impressive guide. Now the rubber hits the road, will investors take comfort that software is in a better place? My take is yes for the next month. Then the Bot Boggy Man comes back and investor concerns rise again.

$MSFT guide was impressive. Stock jumps from up 2% to up 8%. Sounds like growth rates in cloud software will be stable in the teens, which suggest no bot boggy man in this guide. Sept Azure growth of 45% vs. 43% reported in June. No increase in capex.

$META call just wrapped. Stock is down 9.5%, near after-hours session lows. The drift in the stock was tied to investors less encouraged about the timing of the Cloud business. That is a large growth lever that we will have to wait for. The other new products, consumer personalized AI agents will be announced soon, the only problem is investors don't believe they will be impactful in the next year.

Important comment on $META capex on the last question on the call. CFO Susan Li says 2028 capex will focus on keeping their options open. They will spend on land and power and hold off on buying the expensive "chips" until "more cards are turned over. My take: FY28 Meta capex will go higher. If they need all of the capacity they can make through the end of 2027, they will likely need more in 2028. We are just getting started on the AI uses cases.

Update on Superintelligence Lab. Zuck says there is the intelligence aspect and data aspect. He talks about the fly wheel that data builds intelligence, which builds data and more intelligence. My take: They're not there on the data flywheel, which means they have more to go on the intelligence.Zuck keeps talking about that consumer personalized agents as a breakthrough point. That would ramp the data that Superintelligence taps exponentially. $META

Update on Superintelligence Lab. Zuck says there is the intelligence aspect and data aspect. He talks about the fly wheel that data builds intelligence, which builds data and more intelligence. My take: They're not there on the data flywheel, which means they have more to go on the intelligence.Zuck keeps talking about that consumer personalized agents as a breakthrough point. That would ramp the data that Superintelligence taps exponentially.

Zuck talking about the broader tech industry says "there is no where near enough compute compared to the demand" My take: Street is looking for capex from the hyperscalers to be up around 27% next year. I bet it's more than 40%. Thats good for AI infrastructure companies. $META

Zuck says personalized consumer agents coming soon and only so much he can say on the earnings call. Says there is a very large opportunity that will be a "massive" market. Working for consumers on any domain you want. Adds building for billions consumers needs to "just work" The tools available today seem "magical" but they are too complex for consumers. My take: He's got my attention and I'm excited at what they will announce soon. I agree consumer AI is a huge untapped market. Apple is going hard after it with new Siri. Google will soon go after it. It's really those three companies to divide up. $META

$META now down 10%. Looks like META investors wanted to hear they were more excited about building a cloud business in the near term.

$META drifting lower. Now down almost 9% (was down 7% before the comment) in after hours on Cloud comments that it's not a priority. As for timing of building a Cloud business, Zuck says that while they have a lot of demand for compute, but their higher ROI opportunities is not to sell compute, rather use the compute to drive intelligence for Meta. He kept the door open for them to build a cloud business longer. My take: Don't expect anything big on Cloud anytime soon.

Susan Li says long term it's hard to predict exact timing of buildout. Says long term investment in capex will continue to grow in 2028 and beyond. That gives them flexibly to the pace of AI adoption. My take: Good for AI infrastructure trade.

Susan Li takes about Meta One subscriptions. New tools to create and stand out. Says new tools are coming. My take: She did not give any numbers which means they're low. Long term subscriptions are a measurable opportunity.

Instagram time spent grew double digits this year driven by video feeds. My take: Good example of how they keep the daily active people metric growing. It was up 3.4% yy in June, compared to up 4% in March. Overall, 3.6B daily users. Thats about 60% of the worlds daily web users are on a Meta property. $META

Reality Labs up 16% yy. Thats 80% glasses and 20% quest. My take: glasses are likely growing around 25% off of a small base. $META

Zuck says glasses demand is "strong" and above expectations. My take: His expectations must be very low. While glasses are growing, the base is small, maybe 2% of the units compared to smart phones. Sept 23 is their glasses conference. $META

On the business side, Zuck wants to have agents work for business and get paid on outcomes. My take: Likely a year plus away and has a strong value prop. $META

Zuck says Superintelligence with Muse Spark is about agentic opportunities. Wants to ship personal agents that work 24/7 for you and needs to be easy for billions to use. He said more to share soon. My take: He has been talking about personal agents for the past year. The "more to share soon" comment caught my attention.

Zuck says there is a "large business opportunity including selling compute directly". He said details later in the call. $META

$META is down 5% mostly the margin miss. Operating margin (GAAP) 30.9% vs Street 35.6%. Only beat revenue by 0.8%. Capex of $30.1B was below the Street $33.9B. Key on the call is what Zuckerberg says about building a cloud business, and what the costs will be.