“I did the Vision Pro demo and was in awe of this thing. Somehow convinced my spouse to let me get $3,500 to spend on the device, and after six days, took it back. Within six days, I realized this thing is useless. You can't have it on your head for more than 45 minutes. It's an engineering marvel, but it's basically a disaster as a product. No pun intended, it lacks vision. That's Tim Cook, the engineering talent in the company can build a great product, but it doesn't have an ecosystem. I don't think Tim Cook is much of a partnerships guy.”
“After 15 years as CEO of Apple, Tim Cook is officially stepping down. During Cook's tenure, Apple's revenue almost quadrupled, and its market value increased by about 3.6 trillion dollars. On September 1st, Cook will be transitioning to the role of executive chairman.”
China and Services became Apple's financial bedrock
“The first was striking a China mobile deal two years after taking over as CEO of the company. It changed Apple's trajectory in China. It unlocked the iPhone in China and turned China not just from a market that made and produced the iPhone, but it turned Apple into a company that really captured sales from the rising middle class in China. That's really become a bedrock of their business. Then the second thing he did was he looked at the iPhone and he said, okay, well, how do we make more money off a product that now is in the pockets of a billion people around the world? He leaned into services in 2019 and made that a focus.”
China dependency represents a massive geopolitical risk for Apple
“Striking a China mobile deal changed Apple's trajectory in China. It unlocked the iPhone in China and turned China into a market that captured sales from the rising middle class. That's really become a bedrock of their business, but it's a precarious part of their business because of the geopolitical circumstances and the adversarial relationship today between the US and China.”
Apple drastically underspends on AI infrastructure versus big tech
“Apple is basically the only company that is not investing hundreds of billions of dollars into AI infrastructure. I mean, look at Amazon, its CapEx is expected to reach $200 billion this year. For Google, it's close to that, $175 billion. Then Apple is going to spend only $14 billion. They're actually cutting their spending.”
Operations now prioritize rigid deadlines over creative innovation
“What Tim did over time was turn Apple into a juggernaut, a giant machine where operations had a bigger voice in product development. Some of that was necessity. They're making 200 million iPhones a year. You have to make sure that you hit certain deadlines to be able to deliver those iPhones. But the rigidness of those deadlines closed some of the creativity possibilities for people who had once developed these products in a more nimble fashion, and that's locked them into the product lineup they have, and to Patrick's point, made it hard to be as innovative as they once were.”
“As you said, $3.6 trillion added to Apple's market cap. He clearly fulfilled whatever tasks Steve Jobs set him out to do. His role was not necessarily to come up with breakthrough products. It was to iterate what Steve Jobs had already come up with on a global scale. He squeezed every penny that was really available in the supply chain. He built up services, he put Apple into new areas like Apple TV and a host of things like that. He's getting $20 billion of profit per year just out of the Google relationship, just using the user base in Apple's favor.”
Apple remains drastically behind competitors in AI spending
“Is this part of the AI problem here? We talked about the fact that Apple is basically the only company that is not investing hundreds of billions of dollars into AI infrastructure. I mean, look at Amazon, its CapEx is expected to reach $200 billion this year. For Google, it's close to that, $175 billion. Then Apple is going to spend only $14 billion. They're actually cutting their spending. What does that say about the company? Is that because they don't have vision, or is it because they have discipline?”
Hardware lead John Ternus will lead Apple’s next era
“Cook will hand the CEO reins to John Ternus, Apple's head of hardware engineering. Ternus has spent 25 years, half his life at the company, overseeing the hardware behind every major Apple product. The transition marks the start of a new era for Apple, with plenty of unanswered questions about what comes next.”
The Vision Pro lacks developer interest and product utility
“The Vision Pro is an engineering marvel, but it's basically a disaster as a product. No pun intended, it lacks vision. That's Tim Cook; the engineering talent in the company can build a great product, but it doesn't have an ecosystem. Companies like YouTube and Netflix had no interest in building for it. That's a failure.”
