Tim Cook uses Vision Pro every day; most iPhones bought on “some kind of program”

Yesterday’s earnings numbers didn’t contain any major surprises, but there were a few interesting takeouts from the analyst call which followed. This includes the fact that CEO Tim Cook uses his Vision Pro every day.

It was also revealed that most iPhones are now purchased through the iPhone Upgrade Program, trade-in, or some kind of instalment plan, and this is part of the secret to Apple’s success in a difficult economy …

Asked about Vision Pro (via Seeking Alpha transcript), Cook declined to comment on revenue expectations, but did reveal that he personally uses the spatial computer “daily.”

There’s enormous excitement around the Vision Pro. We’re excited internally. Everybody that’s been through the demos are blown away, whether you’re talking about press or analysts or developers. We are now shipping units to the developer community for them to begin working on their apps. And we’re looking forward to shipping early next year. And so we could not be more excited with that. I’m using the product daily.

Bank of America’s Wamsi Mohan asked about the iPhone upgrade program and similar carrier offers. Maestri said that the majority of iPhones were now bought in this way, in the US and elsewhere.

The majority of iPhones, at this point, are sold using some kind of a program, trade-ins, installments, some kind of financing. And that percentage, which again, it’s well over 50%, is very similar across developed and emerging markets. We want to do more of that because we think it really helps reduce the affordability threshold for our products. And we think it is also one of the reasons why our product mix has been very strong during the last couple of cycles.

Cook did, however, refuse to answer a question on lengthening upgrade cycles for iPhones, as consumers now typically hold onto their smartphones for 3-4 years in place of the 1-2 years which used to be more common.

Q: How is the replacement cycle for iPhone? Is it similar, longer, shorter versus prior years?

A: In terms of the upgrade cycle and so forth, it’s very difficult to estimate real time what is going on with the upgrade cycle.

That non-answer effectively confirms that upgrade cycles are continuing to lengthen, as it’s inconceivable that Cook doesn’t have that data – and if there were any good news to share, he would have done so.

Asked about cost-cutting measures, Maestri said that the company had slowed hiring, and been “deliberate” in expenditure – but that the company still prioritized new product development.

You can see that we continue to grow our R&D costs faster than the rest of the company […] Our focus continues to be in innovation and product development, and we’ll continue to do that.