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Tim Cook calls Wall Street response to Q2 earnings a ‘huge overreaction’ in CNBC interview

Screen Shot 2016-05-02 at 7.01.29 PM

[UPDATE: Video below.]

As expected, Apple CEO Tim Cook this evening appeared on CNBC’s Mad Money with Jim Cramer to discuss the recent news surrounding the company’s second quarter earnings results. The company reported $50.6 billion in revenue and $10 billion in profits, but its stock was sent into spiral. Speaking to Cramer, however, Cook defended Apple’s future and called Wall Street’s response a “huge overreaction.”

Cook acknowledged that the company “clearly” didn’t meet Wall Street’s expectations last quarter, but attributed much of it to a slower upgrade rate this year versus the abnormally high rate last year. In the end, Cook says all that matters is that customers are happy:

The $10 billion is more than any other company, so it was a pretty good quarter but not up to the Street’s expectations clearly. What we’re seeing is that people are upgrading at a lower rate than they did last year, but still higher than the year before. But the most important thing is that customers love our products and they are using them and the satisfaction has never been higher and the loyalty rates have never been higher. And that is what is really important for us. That’s the most important thing for the long term of Apple.

In typical Cook fashion, the Apple CEO also teased what the company has in store for the future in response to claims that it no longer innovates. Cook said that Apple has “great innovation in the pipeline” and new iPhones that will incentivize everyone to upgrade. “We are going to give you things that you can’t live without that you just don’t know you need today,” Cook teased.

When pressed about the company’s performance in China, Cook argued that the smartphone market as a whole isn’t growing, but rather it’s just movement within the existing market. Cook noted that the rate of people switching from Android to iOS is up 40 percent over the first half of last year and over the past two years Apple has grown 70 percent in China. Cook also admitted that it was his error in not better expressing his high hopes for China on the company’s earnings call.

In speaking about Apple’s growing Services sector, Cook explained that the relationship between Apple and a customer doesn’t stop after they purchase their device. Cook pointed out that Services is now Apple’s second largest sector and is continually growing thanks to Apple Pay and Apple Music.

You can view the full transcript below and we’ll update this post when we have video of the interview, as well.

JIM CRAMER: Tonight we got an incredible opportunity to check in with Tim Cook the CEO of Apple himself to get a better sense of how his company is doing and where it is headed Mr. Cook welcome back to Mad Money.

TIM COOK: Thank you for inviting me it is great to be here.

JIM CRAMER: Tim there’s a curious really strange disconnect between what I read and hear on Wall Street about Apple and this because it is going to be an impossibility to pry this from me.  Cold dead hand time.  You can’t. And yet when I read the stories it seems like people think that it is over.  How could it be that you can’t have this ever or the ecosystem but it is dead?

TIM COOK: Yeah, I think that is a huge over reaction look we just had actually an incredible quarter by absolute standards 50 billion plus in revenues and 10 billion in profits.  To put that in perspective the 10 billion is more than any other company makes so it was a pretty good quarter but not up to the Street’s expectations clearly.  What we’re seeing is that people are upgrading at a different rate a lower rate than they did last year but still higher than the year before so we had this abnormally high upgrade rate last year as people bought into the iPhone 6 and now we are comparing to that along with the other things going on that many companies are facing with currency rates and macro economics, etc.  But the most important thing is that customers love our products and they are using them and the satisfaction has never been higher and the loyalty rates have never been higher.  And that is what is really important for us. That’s the most important thing for the long  term of Apple.

JIM CRAMER: Let’s talk about shorter term that has captivated the narrative.  Tony Sanguinetti good analyst on your call all the time tells the New York Times there’s no question that Apple’s best days are behind it the company grew at astronomical rates and it is now so big that its ability to grow at these rates doesn’t exist anymore.  There’s an obituary.

TIM COOK: Yeah,  I couldn’t disagree more.  Here’s what I see.  We are in some incredible markets the smartphone market eventually everyone in the world will have a smartphone.  Penetration today is in the 40s a long way to go. Emerging markets like India LTE penetration is zero we’ve got great innovation in the pipeline new iPhones that will incent you and other people that have iPhones today to upgrade to new iPhones.

JIM CRAMER: I will need something else?

TIM COOK: You will need something else.

JIM CRAMER: I can’t think of something else that I need.

TIM COOK: But we are going to give you thinks that you can’t live without that you just don’t know you need today.

JIM CRAMER: Ok that’s what I want.

TIM COOK: That has always been the objective of Apple.  To do things that really enrich people’s lives.  That you look back on and you wonder  how did I live without this.

JIM CRAMER:  Why is the story not talked about nearly as much that this is also a service.  It is viewed as a device.  You are a hardware company verses what we know other than the Netflix bill maybe the Amazon bill you can put things on this whether it be my music I have the family plan because I have a lot of pictures and I do the iCloud backup the Apple Pay why do people not talk about the fact that this is not a dead device it is something that we belong to.

TIM COOK: I think in fairness we didn’t talk about it a lot until recently and so I take that.  As you say, services now is the second largest revenue segment at Apple.  It was for last quarter it was for the first half of the year as far as that goes.  And so last quarter we were at 6 billion up 20%.  It is fast growing.  You look at what it is it is things like the app store you go and you buy apps far after the sale.  You might have subscribe to Apple Music.  You might use Apple pay  you might buy songs you might rent movies and so it is all of these things and it really adds up.  And that of course is based on how many people are using our devices how many devices out there and there’s over a billion devices in use.  This is huge.

JIM CRAMER: See because I – exactly. I figure when it gets to 1.5 billion. Some – there’s a number where we will be thinking of the average use each month and the average paid to you. It’s not there yet. In the interim what defines the story would be that China’s fallen off. That China, which you said in the previous quarter was going pretty good. But the beginning of this last month of the last quarter was not that good, has now become – clouded out everything else. Right? Wrong? Should be? Shouldn’t? You’ve talked endlessly about China, middle class vacation. What’s happening there and how did it happen so fast that many didn’t see it coming?

TIM COOK: Well, here’s what we see going on in China in the short-term. In the short-term, the iPhone upgrade rate affects all countries including China. The great thing is, the switcher rate in China is huge. 40% up over the first half of last year, the first half of this year. This is huge. So these are people switching from Android smartphones to iPhone in China. Economy, clearly not as strong as it was a year ago. Softening. Currency weakening. And so you’ve got a confluence of items in there, some that are Apple-specific like the upgrade thing that we talked about, some things that are more general that affect everyone. However, here’s the way I look at it. Two years ago we had enormous sales. And so last year and last year we did even better, 80% better. So we grew 80% over the previous year. This year in constant currency in mainland China, we were down 7. So if you look at it on a two-year basis, Apple grew 70% in China. It’s hard-pressed to say those aren’t good results.

JIM CRAMER: Ok. I want to stay on China for a second because the first leg down on the stock last week was because your guidance. Second leg down was a man, Carl Icahn, who had been closely affiliated talking about a no-brainer Apple, who says, “Look, China’s an issue.” Now, he sold before we knew anything about the China State Administration of Press, Publication, Radio, Film and Television blocking Apple iBooks and iTunes movies, but was concerned, at least ostensibly, about China. So then, and I look at the different components of China, yes, upgrade. But how about White Box? How about the fact that there is an encroachment issue at the lower end? And is that something that could’ve slowed Apple sales down?

TIM COOK: No. I think what you see in China in general is the smartphone industry isn’t growing. There’s movement between different suppliers of smartphone. But I think in the areas that we play we’re doing quite well. And in the last month, I’m thrilled at what we’ve seen with the iPhone SE launch that’s been there. This is the phone that we just shipped that packages a whole bunch of our technology from iPhone 6S into the four-inch form factor. And so that looks very strong. In terms of the books and movies, what you’re talking about is that we did offer books and movies. Currently we’re offline. And we’re, what I can tell you there is we are working with the relevant government agencies and other businesses and we’re pretty confident and optimistic that we’ll be back online and offering those to our Chinese customers soon.

JIM CRAMER: Okay. So the idea that perhaps a large hedge fund investor months out is quite different from the notion of, if someone just bought it and owned it rather than looking at their quarter to quarter, probably a better way to look at Apple over the long-term?

TIM COOK: Yeah. I think from a long-term point of view – let’s go back to China for a minute because I think this is important. Here’s what I see in China – we see in China, is the middle class there is booming. And so you look back just five years ago, there were about 50 million people in the Chinese middle class. Five years from now that number’s going to be almost 500 million. I mean, this is an unprecedented growth of the middle class.

JIM CRAMER: But you left that out this quarter. On the conference call, I parsed every word of your last few conference calls. You did not talk about middle class classification, which then made us feel that something was wrong?

TIM COOK: No. No, I – then it was my error for not talking about it. I am – I could not be more optimistic about China. I think the long-term thesis is intact, there has never been anything like it in the history of the world. And I’m still as optimistic as I’ve ever been.

JIM CRAMER: India, obviously, brand new iteration. Finally LTE, people at home should know. Finally a system that could be – that can use your great phones. Inning one, inning half, lots of people?

TIM COOK: Yeah, let’s talk about this. This is another huge one. India will be the most populous country in the world in 2022. India today has about 50% of their population at 25 years of age or younger. It’s a very young country. People really want smartphones there, really want smartphones. And this year, the first year, LTE begins to roll out. And so many of your viewers here in the United States, they’re used to using LTE and streaming video. And hopefully they’re getting a good experience there. In India you can’t do that long – there is no LTE. And so that’s changing. Huge market potential.

JIM CRAMER: Okay, let’s stay right there. I’m going to come back after the break when my interview with Apple CEO Tim Cook continues. Stick with Cramer.

JIM CRAMER: Welcome back. We’re here with Apple CEO Tim Cook. Tim, want to talk about the stock a little bit. It is ”Mad Money.” Huge buyback. Lot of people saying, “Well, wait, they keep buying back one-fifth of the company.”  But what has it done? Your stock is down below where you bought the average amount, you know, much higher price. Is it a waste versus innovation? Or is it not really a tradeoff?

TIM COOK: It’s not a tradeoff, is the answer to that. We first look at all the money that we need to invest in the company, in R&D, in stores, in the supply chain. All of the areas we need to do including M&A. And we take the money that’s leftover if we have some, and we do at this point, and we give it back to our shareholders. And we do that in terms of dividends and buybacks. And so if you look at dividends we just raised it for the – every year. Every year since the beginning. We raised it to $0.57 this time and we’re very happy to give that to our shareholders. And on the buyback side, we’re – I didn’t see how the stocked performed today, but we were still below – the last time I looked, we were still below the average that we pay. And we tend to be opportunistic in buying it. And so we don’t have some regimented program that, you know, is X shares a day or whatever.

JIM CRAMER: But if you talk about macro headwinds, dominant on the theme – on the conference call – difficult compares – dominant. Currency, no new iteration yet, why not wait? What’s the urgency? If you’re going to be opportunistic wouldn’t that say, “Let all the negativity come out. Let all these hedge funds blow it out and then we’ll make a statement?”

TIM COOK: Well, opportunistic to me means you buy it when you think the company’s undervalued, and we believe the company’s undervalued.

JIM CRAMER: Fair enough. Now, how do you know – let’s talk about the mindset. Because the mindset’s not based on – they’re not lunatics who make up these things. They don’t believe best day ahead, they believe that the pause in growth is not a pause. But they’re looking at Microsoft under Bill Gates and then goes to Steve Ballmer. They’re looking at Hewlett and Packard and thinking, “Well, whatever happened to that?” They’re looking at Andy Grove, Gordon Moore and they’re thinking Intel. And they’re saying, “Well, these guys were all fabulous. And then the next thing you know, I mean, they’re selling at nine times earnings like Tim Cook. And what, so when you’re down at nine times earnings what that says is, ‘It’s over.'”

TIM COOK: Let’s back up for a minute. Let’s take a step back and let’s look at, how did we do in this quarter, or the first half or whatever. And what you would find is $50 billion and $10 billion profit. No one else is earning anywhere near this. Last year, we earned $53 billion in profits. And I think the number two company was 24. And so we’re doing pretty good.

JIM CRAMER: No one’s – right. But that is important.

TIM COOK: And by the way, we did also – we did what we said we would do. We said the revenues would be between $50 and $53, we came in at $50.6. We said margins would be 39% to 39.5%; we came in at 39.4%. But the real answer to your question is that the thing that is different is that customers love Apple products.

JIM CRAMER: Customers didn’t like any of those companies.

TIM COOK: And the relationship with Apple doesn’t stop when you buy an iPhone. It continues. You might buy apps across the App Store, you might subscribe to Apple Music. You might use iCloud to buy additional storage. You might buy songs, you might rent movies. And so there’s a significant number of things. You might use ApplePay every day now, or at least several times a week. And so that relationship continues. And because our customer loyalty is so high, the likelihood that somebody upgrades to another Apple iPhone in this particular case, is really great.

JIM CRAMER: Okay. So let’s talk about innovation and that revenue stream. You’ve said over and over again, “Can’t buy innovation,” because that’s in your DNA. Why bother to buy someone else’s which won’t be as good? But at the same time you have this service team you just mentioned. You said that you want to do M&A, even bigger deals where you are most excited. I listened to you today right here. It seems like you’re most excited about services. Is that where M&A can come? Because why not put it through this new 1.5 potential device channel?

TIM COOK: Yeah. Could it come in services? Yes, and we’ve bought some companies to help us in services. But it can also come in a number of other areas. We’re barely acquisitive. We haven’t acquired a very large company yet, but we’ve acquired a lot of companies. We generally acquire a company every three to four weeks on average. And so it’s a rare month that there’s not a company being bought. We typically buy for technology and really great people. And but you know, we’ll see. We’re always looking.

JIM CRAMER: Now, when we talk about innovation there – again, I don’t want to beat the dead horse, but you know the rap. The rap is, “They’re not innovating.”  And yet we find ourselves wanting to buy the new iteration. I mean, you are a surprise company. It would be ridiculous for you to talk about what’s going to be in the 7 because I – it’s a statement and it’s also a play. It’s a drama. There’s drama at Apple. There’s no drama to Intel. I mean, there was never any drama to Hewlett Packard. How important is drama to you? Because I also happen to know that you’re a thoughtful guy who likes literature, likes movies, likes TV. And you like an arc.

TIM COOK: Yeah. We don’t talk about futures as a company. As you say we’re fairly secretive. We don’t talk about products that are in the roadmap. But I would tell you that we’re incredibly excited about things we’re working on. Incredibly excited. And so I don’t want to be more specific than that. But I think that the other thing maybe that’s worth pointing out is, if you kind of look at all the things Apple has done over time, at the time they were done they were rarely ever seen like they were in retrospect.

JIM CRAMER: Well, this bust. You talk about the bust of the phone – of the watch?

TIM COOK: I think the watch would be like that, too. Because if you look at iPod, iPod wasn’t viewed as a success, but today it’s viewed as an overnight success. The iPhone was the same way. People were writing about there’s no physical keyboard. Obviously nobody would want it. And so I think that in a few years we will look back and people will say, “How could I have ever thought about not wearing this watch?” Because it’s doing so much for you. And then it will all of a sudden be an overnight success.

JIM CRAMER: But then I went to the second letter that Icahn sent you about doing a buy back. By the way, that was in the mid 120’s. It was obviously, in retrospect, a trader, I think, saying, “This is the time to buy.”  But he talked about 20 million watches and then 40 million watches. When we see these things in fiscal year 2016, we see these things we say, “How did they get them?”  I just want to make it clear, it is not your guidance. You never talked about numbers like 20 million and 40 million, right?

TIM COOK: Never.

JIM CRAMER: That is just other people running with the ball. And why do they run with it when you say, “Listen, we’re not making any projections like that?”

TIM COOK: I don’t know. The way that we look at the watch, though, we were – our first goal is to establish a new category. Smartwatch category wasn’t really established, so we needed to establish the category. And we wanted to roll out slowly. Well, today, to put it in perspective, you can buy Apple Watch in 14,000 locations. You can buy the iPhone at over 200,000. And so we’re still in learning mode. We’re learning fairly quickly, though. We know a lot more than we did a year ago. And you’ll see the Apple Watch getting better and better.

JIM CRAMER: Okay. Just for this last series of questions, I do need to talk about size. There is a – we can use baseball analogies, we can use football, whatever. But we need to know where you think we are versus this notion of the first question on the conference call. It’s about now you’re a value stock. And I’m thinking, “You know what? I don’t like to think value versus growth.”  I like to think what – where we are in a cycle, total adjustable market. Where do you think we are China, India, worldwide, developed, not developed. In terms of the need to have this and the need to upgrade?

TIM COOK: Yeah, let’s talk about smartphone first – iPhone. What I see is that countries like India, no LTE, so 0% penetration. They are selling smartphones, and we sell iPhone there. But arguably you can’t get the full value from it.

JIM CRAMER: And it’s Mom and Pops that you buy it from, it’s not a—

TIM COOK: Yes, because the retailers are not huge national kind of retailers. And the carriers don’t sell phones in India. So there’s a lot of work to do. But last quarter we grew 56% in India on iPhone units. So this is pretty big. Overall, macro worldwide, smartphone penetration is in the 40s. And that’s IDC kind of numbers –

JIM CRAMER: Why does Wall Street think 40s is done? Meaning 40% is – what point of the conference call – honestly Tim, I’m looking at all the calls. 40 is 80 to these people, 40% means 80. Because they’re looking at developed world, they’re saying, “Well, wait a second, developed world’s moving much further.”  No one uses your numbers, by the way, which is really kind of odd because you are the CEO. But I repeatedly get the sense that people say, “Developed is finished and emerging isn’t going to be your – .”  I don’t know why either – I just need to refute this.

TIM COOK: Yeah. Well, here’s what I would say to that, is I heard the same thing about China. And our revenues from China were larger than any other foreign company. In greater China last year revenues were $58 billion. And so we do know something about emerging markets. And you know, it turns out that people in every country in the world there’s a segment of buyer that wants the best product and the best experience. And that’s what we’re about providing. And we did fairly well in China, we’ve done fairly well. And despite the short-term turbulence here, we’re doing fairly well now—

JIM CRAMER: But you’re saying short-term turbulence, they will – they are upgrades, start again –

TIM COOK: Middle class is huge. And now we’re really putting energy in India as well. And there are other markets in the world where I think that people sitting here in this country look at it through just a lens of what’s happening in the United States. And but there are a lot of people in the world who don’t have the pleasure of owning an iPhone yet. And now, the second thing I would point out is the number of switchers that we – switchers are people that were using an Android phone, they switched to an iPhone. Largest ever in the last six months. So despite overall iPhone sales declining, led by the upgrade that we talked about, switchers hitting new records. In China switchers were up 40% from the first half of last year to the first half of this year. And so switchers we feel great about, that’s really important. Because what that says is, the market doesn’t need to be growing hugely for Apple to grow. Because our share is you know, relatively speaking, in many markets, low. And if we can get switchers over, we can grow.

JIM CRAMER: Okay. Well, if that’s the case then I want to know whether you think Wall Street, I know you care about it, is dead wrong. Because Wall Street looks at it by the four walls of the spreadsheet. “Okay, 9.22 going to 8.40. Who knows? Maybe go back to 9.0, $9.10.”  Remember, they’re just looking at it and they’re making the judgment that only – that stocks lose their multiple – lose the price earnings multiple – if you can’t get the numbers up. And they’re saying, “You’re not giving us any window when you will. You already said this next quarter is not going to be that good. Why should we buy?”  I mean, in the end it’s a little bit binary to them. “Why should we buy when we know that stocks that have this trajectory have historically hurt us?”

TIM COOK: Yeah. I think Wall Street is a collection of people, right? And so there are many different viewpoints in there. And I’m not sure there is a common one. I mean, that’s the beauty of the street, is there’s a diverse group of thoughts. But in terms of what we think, which is what I can really attest to, we’re reasonably good at estimating what we think we’re going to do. I’m not saying we’ve always been right or always will be right. But I think if you look back versus our guidance, we’re pretty good with that.

JIM CRAMER: No, you’re –

TIM COOK: We’re really good with it.

JIM CRAMER: Yes. And that’s why the – that’s why this quarter there’s a misperception that it was a miss. It was exactly what you were looking for. And next quarter is down. But I’m just saying, last question, but

TIM COOK: But over a long –

JIM CRAMER: Do I have any confidence that the last quarter of this fiscal year is going to be up?

TIM COOK: At the last quarter, I’m not projecting quarter by quarter. But what I can tell you is, backing up and looking at the larger picture, we’re in great markets. We have huge opportunities geographically. We’ve got great innovations in the pipeline. People love our products, they love using our services. All of this to me equals great opportunity. Now, your viewers have to decide what they want to do obviously. But this is how I feel and that’s what I can attest to.

JIM CRAMER: You know, I say don’t trade it, own it. Tim Cook, CEO of Apple. Thank you so much, sir.

TIM COOK: Thank you. Great seeing you, Jim.

 

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Comments

  1. eswinson - 8 years ago

    It was

  2. applegetridofsimandjack - 8 years ago

    I kinda agree but I also have to say that Apple, under Tim Cook, still hasn’t released a new revolutionary product (new category). Apple Watch, the new Apple TV, iPad Mini and iPad Pro are not nearly as revolutionary as the iPod, iPhone and iPad were at launch.

    Well maybe you could argue Macbook being the one only true awesomeness but still not nearly as revolutionary as iPhone iPod or iPad.

    • chasinvictoria - 8 years ago

      I would point out that by your own criteria, Steve Jobs — across more than 25 years at Apple — released only four “revolutionary” products: the Apple II, the Mac, the iPod, and the iPhone (I would dispute that the iPad is revolutionary). I would argue that the Apple Watch is revolutionary, in that it will eventually replace the iPhone (and created an entire industry), and that Apple Pay is revolutionary. Not bad for a guy who has officially been on the job for all of five years. But you know, Apple’s sole purpose is not to fart out a “revolutionary product” on a regular let’s say five-year schedule: it’s to make great products that turn a nice profit. Some might be revolutionary, but most (as with most of Apple’s output) are more evolutionary. Looked at through an unbiased lens, I’d say Jobs chose well in picking Cook as his successor — the Apple today is not the one that needed Jobs in 1997, it is in a new phase — and needs someone who fosters great products and keeps the lights on more than it needs another “genius” as CEO.

      (to be clear: Apple still needs geniuses, and has a few — it just doesn’t need another Jobs in the CEO post anymore, which is something I think Jobs saw as well.)

    • jakexb - 8 years ago

      You should go back and read people’s reactions to the iPod and iPad. Almost complete mockery. The iPod was seen an inferior product to other hard drive MP3 players of the time (that no one now remembers). The iPad was seen as just a giant iPhone with no real use case of its own.

      The iPhone was received better as a tech marvel for multi-touch, but was it was generally assumed that Apple would be lucky to get to 1% market share with it. Nobody believed it would be as successful as it was. Not by a long shot.

      Yes, the iPad sizes are not new products. But they are useful products that address different concerns. The Apple TV is a solid iteration of a previously existing product. The Apple Watch is just getting started.

      It’s frustrating to see Apple fall victim to people’s nostalgia for a time that never existed. Apple has consistently made quality products that were skeptically received at launch and then iterated on them repeatedly, refining them over and over. That is exactly what is still happening today.

    • J.latham - 8 years ago

      While there was a sense of a revolutionary turn around 2000-2010 for Apple products, for the most part, they made a LOT of great iterations. They did a very good job at taking an idea that might be revolutionary and fine tuned it to get that reaction. The iPod is a great example it didn’t really turn into the MP3 player everyone wanted until gen 3 and the addition of the mini and nano models. Yes, it was a great product but it wasn’t until they softened the edges and made it for more music in smaller sizes that easily fit in your pocket that the mass public came running to them.
      That being said, if there is anything I feel that Apple under Cook vs Jobs needs to correct, it’s a lack of restraint. Not necessarily with things like the Apple Watch as a product or a category but in the amount of models in each product category. Jobs wasn’t immune to this near the end of his run either, don’t get me wrong. He started the process where old iPhones stick around as the more budget alternative so in some respect that is his fault but they need to get back to how the iPod line was run in my option. The different models were based on different types of consumers needs and for the most part, they upgraded each model every year/every other year and got rid of the old model. When they came out with a new iPod nano (even when there might be a price drop), they didn’t keep last years model around for $50 less. They made the best iPod the could for people who wanted a smaller, more portable experience and that was what they offered. End of story. If that means some products don’t get an upgrade for a year, that’s fine. Maybe just a price drop mid cycle like the iPod shuffle, that’s fine.

  3. giuseppe9000 - 8 years ago

    “There are a lot of people in the world Who don’t have the pleasure of owning an IPhone yet”

    considerations on apple’ confort zone, cook’s golden cage:

    – He is speaking only of iPhone expansion, so the attention on the other products is unnecessary or, with more probability, ineffective

    – he is using a marketing approach to investors rather than a tecnological or economic register, this is bad for both the customers and the shareholders, this demonstrate how poor is his affection towards technology and how much he relies on the advertising and hype to…get the stock go up

    • rnc - 8 years ago

      You talk like Wall Street gives a shit about technology. He didn’t speak for the costumers, he spoke for investors.

      He might as well be speaking Chinese, too… those people don’t understand tech, they only understand $$$.

      • giuseppe9000 - 8 years ago

        saying you have to own(and hold) apple stock because “we are great” is for religious believers, not investors

        he should have said why apple’s future is great but he didn’t: he just said “believe in apple”

        his marketing register is not for wall street, “how great is to use iphone” doesn’t excite anyone on wall street, neither chinese investors, it has effect only on addicted people to apple and all the hyspers.

        this is a poorly speaking CEO

        if you sell cars, you can’t say just “our product is great, is a pleasure to owning it” expect positive reaction. this is for a stage performance.

  4. el3v3nty - 8 years ago

    thanks for posting this transcript. i like reading more than watching a video.

  5. Grayson Mixon - 8 years ago

    The video is up in two parts on the Mad Money website.

  6. Johnny Mabry - 8 years ago

    “Cook pointed out that Services is now Apple’s second largest sector and is continually growing thanks to Apple Pay and Apple Music.”

    That’s nice, Tim. Services is still only 12% to the iPhone’s 65% of total revenue, so it’s going to take A LOT of growth for that 12% to offset the losses from the 65%.

    • jakexb - 8 years ago

      Eh, it’s growing. Apple Pay is still in its infancy. I find myself using it more and more over time.

      Also, consider Apple Music. Everyone likes to slag on it, but not even 1 year out they’ve got nearly half the paying subscribers as Spotify, who had a huge head start. And it’s still growing at about 1million new subscribers per month.

      Just examples of a whole constellation of services that they’re building up.

      Also there were no losses. They sold slightly less iPhones than they did last year at a 35% margin. They made a ton of money.

    • markm49 - 8 years ago

      They made $10 BILLION dollars PROFIT. There are no losses to offset. FFS.

  7. rnc - 8 years ago

    Does anyone know where I can watch this video, outside the US? Thanks!

  8. Grayson Mixon - 8 years ago

    The videos are posted in the wrong order. The China video should go first.

  9. o0smoothies0o - 8 years ago

    Wireless distance charging

  10. sally (@FedGoat) - 8 years ago

    Cook is clueless. the 6S wasn’t enough of a reason for millions to get a new $800 phone. Carriers are doing away with 2 year contracts and now people are learning the Real price of an iPhone and its not $199 per 2 years now.
    They need to drop this 2 year, same exact design cycle. Refresh the look every year.
    it doesn’t have to be Drastic. more akin to what they did with the Galaxy S6 vs S7. Similar, but enough different to tell one vs the other.

    Apple needs 3 OPTIONS to bring more Android users to iOS. ( I know apple heads hate options, but some of us WANT options)
    REAL Widgets, lock screen widgets are a joke and useless.
    Native App choice.if I want Gmail to be my native mail app, Why Not? it’s an Option, not a requirement.
    Option to turn off the stupid auto arrange on the icon grid. I want my icons at the BOTTOM where I can reach them. Reachability is stupid.
    Those 3 things are 90% of why people buy android over apple. Too restrictive.
    Again, all those would be OPTIONS, you do not have to use them or want them.

    For me, a 4th would be a real NATIVE Swipe keyboard. 3rd party keyboards are worthless in their current implementation. of course with the OPTION to turn swipe off if you don’t want it.
    I don’t want them to take anything away from the OS, I want them to ADD MORE OPTIONS. More customization.
    Not just a grid of icons that auto arrange as far away from my thumb as possible.

    • markm49 - 8 years ago

      Just buy an Android and be done with it. You are clueless.

      • sally (@FedGoat) - 8 years ago

        You will want features when apple tells you its ok to have them. keep being a sheep.

  11. drtyrell969 - 8 years ago

    Everyone should sell until Tim is out. He’s not technical. He has no eye for the next stage of Apple. He’s a horrible salesman. He’s horrible on stage. He’s NOT Apple in any way shape or form.

  12. malcolmtucker1 - 8 years ago

    Biggest problem in the interview is that Tim is looking down and to the right most of the interview.

    If he was looking up and to the right, he’d be recalling visual images such as those on paper, presentations or presented on a whiteboard. Instead, down and to the left is based more on “Feelings”.

    I’d be worried if I owned stock in the company.

    Example:
    Down and to the Left
    Indicates: Feeling / Kinesthetic (F)
    If you asked someone to “Can you remember the smell of a campfire? “, this would be the direction their eyes moved in while thinking about the question as they used recalled a smell, feeling, or taste

Author

Avatar for Chance Miller Chance Miller

Chance is an editor for the entire 9to5 network and covers the latest Apple news for 9to5Mac.

Tips, questions, typos to chance@9to5mac.com