Aug 14, 2019
New US tariffs on China get delayed... because of holiday shopping Read More iTariffs... President Trump announced them just 2 weeks ago. With everything else already tariff'd, the US planned to tax the remaining $300B worth of consumer products made in China starting September 1st — including the iPhone. Yesterday, he said nevermind: waiting until December 15th for most new tariffs so American shoppers can have a Merry Christmas.
Teachers hate procrastination... Markets don't. The tariffs were essentially a 10% tax that would hurt profits for companies manufacturing in China, while raising prices by 10% for everybody. Here's who wins with Tuesday's sudden flip:
Apple: Shares popped 4% because iPhones and MacBooks won't get 10% more expensive until after most holiday shopping is done. Made in China AirPods, the Watch, and HomePod still get hit on September 1st, though.
Mattel & Best Buy: The stocks rose 5% and 6% as Made in China action figures and speakers will remain tariff-free through the holidays.
Nike: Sneakers were also on the exemption list, so the swoosh jumped up 2%.The Takeaway:This sends a message to China... If the trade war has political or stock market costs, America might cave. Credibility is important in negotiations, and Trump's credibility takes a hit with this one.
Political cost: Since American buyers pay US tariffs, not Chinese exporters, this latest round would have grinched Christmas for American households.
Stock market cost: If tariffs caused poor holiday sales, stock markets likely would've suffered.
Sep 19, 2019
Ancient glass-icon Corning snags $250M from Apple for your phone screen Read More Tapping is the new clicking... And iPhone swipe/touch/scroll is like a massage for Corning's key product: the iPhone screen. The glass legend was founded before the Civil War in Corning, NY (population 10,700 and it's still HQ'd there). It supported the creation of the light bulb, car windshields, and — in 2006 — the iPhone. And it just earned a $250M investment from Apple.
One's not like the other... Seems weird that Apple's investing in a 19th-century supplier of glass parts. But it makes sense for two reasons:
Public Relations pandering: All iPhones are made in China. To show it's contributing to American jobs too, Apple put $6B into the Advanced Manufacturing Fund to support its American parts suppliers. This was one of its investments.
Product tempting: Apple needs new features to convince you to splurge/upgrade to future iPhones. Corning's using the $$$ for its scratchless "Gorilla Glass" – it's researching new versions for foldable phones and glass-backed wireless charging.The Takeaway:Tiny slice of good news, big slice of bad... Corning's Apple announcement was outmatched by a bad one about the rest of its biz. Corning also makes TV screens and fiber optic cables (for the telecom industry) — The stock dropped 7% after its earnings revealed the outlooks for both are dimmed. Looking at where its revenues come from, it's clear why:
12.5% of sales = Specialty Materials (like Gorilla Glass): The Apple news affects this part of Corning.
87.5% of sales = Other glass sales: This part's all non-Apple products. — nearly all of Corning's revenues. That's what investors focused on this week.
Sep 10, 2019
Apple reveals iPhone 11 — then ends its always-raising-prices streak Read More The Touch screen. The no-headphone-jack. Siri... Apple has evolved over the course of its annual new iPhone product unveils. The stage and dark lighting haven't. Here's what we get with the new iPhone 11:
Size and colors: Pastels for days with the new lavender, soft green, and honey yellow. Both the regular and Max versions are slightly bigger than the previous ones.
A "Pro": $999+ gets you three cameras (the starter, a backup, and 3rd-string, just in case), which create quite a bulge. Your move, Pixel 4.
The "Slofie": Sloooow-mooootion videoooo getssss addedddd to the front-facing camera, too.
Forget iPhone — Apple TV+ is the star... and it arrives Nov. 1 at a ridiculously low-priced $4.99/month. Netflix ($12.99), HBO Now ($14.99), and even Disney+ ($6.99 starting in November) aren't happy about this price war aggression. Tim Cook also showed off original Apple TV+ shows (there aren't many of 'em, but they star Steve Carell and Reese Witherspoon) and a $4.99/month video game "Arcade" pass.The Takeaway:Apple's thinking about the whole customer... New colors, a 3rd camera, and the A13 chip aren't forming fanboy lines outside glass-plated Apple Stores anymore. So it's focusing on prices: Lower some prices, offer some freebies, and hope to make $$$ on sales every few years (with monthly service subscriptions in between):
iPhone 11 starts at $699 and the Pro version at $999 (iPhone X started at $999 when it debuted in '17).
Apple Watch 5 is the same price as the previous ones and its Watch 3 is a Fitbit-ish $199.
Apple TV+ costs a Venti Latte per month at $4.99, or free for a year when you buy a Mac, iPhone, or iPad.
Oct 15, 2019
Apple is reportedly going down-market with a $399 iPhone in Q1 2020 Read More You overpaid for your iPhone by like $400... On the same day Apple inched past Microsoft to return to the #1 most valuable US company (iPhone 11 is apparently selling well), we get this shocker from a research analyst with a very particular set of skills:
The legendary Ming-Chi Kou studies Apple's supply chain for clues about the number of iPhones produced and the next model coming.
He just reported that an "iPhone SE 2" will be unveiled in Q1 2020.
The new creation boasts an iPhone 8 body with an iPhone 11 brain — for $399.
Going down-market, Apple?... This could finally compel frugal Apple buyers to upgrade. It may even convert some of the Android flock to Apple's ecosystem.
Upgrades: An estimated 200M humans stubbornly still use the iPhone 6 or 6s (can't believe that model is 5 years old).
New converts: Over 80% of the world's smartphone users and 51% in the US are on Android, Alphabet's operating system. And most Android phones are much cheaper than iPhone.The Takeaway:Phone profits aren't the priority anymore... The last Apple budget phone was iPhone SE (great for her jeans pockets). It annoyingly stole sales from higher-end iPhone 7s, hurting Apple's profits. But now Apple just wants more Earthlings with iPhones in their hands so it can make money monthly on recurring "services." More phones = more potential iEverything customers (iCloud, Apple Music, Apple TV+, Apple News+, Arcade...).
Mar 22, 2019
Apple's wireless charging AirPods cap its product-palooza Read More The jewelry of Silicon Valley... are the new $159 AirPods you wish were all up in your ears. Apple just unveiled them. And unlike your ancient 2017 AirPods, they do this:
Speak with Siri by voice straight through them, so she's in your ears all day, e'ry day.
Wirelessly charge if you upgrade to the new, magical wireless-charging case for a smooth $40 more.
Connect via Bluetooth way faster, so no more annoying waiting when you're just trying to get Spotify going before your run.
Do less, Apple... These new AirPods were its 3rd product unveil this week. First, they hit us with new iPads and then Apple updated iMacs for the first time in two years. By the way, you busy Monday? Apple's got a bigger launch event planned, expected to be its "Netflix Killer."
The Takeaway:The art of the pivot... Apple's making it. Sales in its wearables biz (including AirPods) jumped 35% last year — But they still only make up 6% of all revenues. The iPhone? It's 66%. But since iPhone sales, the pride-of-Cupertino, are slowing, Apple's trying to make services and anything else happen (like "fetch").
Aug 20, 2019
Apple's Goldman Sachs credit card is now available for all (iPhone-owning) Americans Read More "Hover"... That's the non-swipe verb Apple envisions you motioning with your new Apple Card, the digital-native payment method it announced in May last year. Welp, it's finally available to all (in the US), and you apply through the Wallet app on the iPhone. If you're approved, you get:
Hoverability: Apple Card's natural habitat is Apple Pay, the contactless payment method built into the Apple Wallet app.
Privacy: The card doesn't even have a number. It's witness protection program approved, and totally encrypted, generating a new digital number with every transaction.
Rando coolness: When you first get your card, it exists on your phone in a blank-slate white hue. Then it changes color based on what you buy (restaurants = orange).
3 is for me... People ❤️ points. So Apple's giving you 3% cash back when you make Apple purchases or pay for an Uber. If you pay through Apple Pay on your iPhone, you get 2% cash back. But there's also a physical brag-worthy titanium card — Apple only gives 1% cash back when you pay non-digitally. It's subtly incentivizing iPhone-dependency via points.The Takeaway:Apple Card is access to iPhone Nation... CEO Tim Cook wants Apple Card to become a status symbol. He knows that, and is offering up membership to what we're calling "the 3% Club": merchants that will offer Apple Carders 3% cash back. Here's why we expect more companies to ask Apple to join the deal and exclusively accept Apple Card:
What merchants pay: That cash back you get comes from somewhere — the store pays it.
What merchants get: The loyalty from iPhone Nation — if you get 3% off every Uber ride, are you really gonna take Lyft?
Jun 28, 2019
The designer of the iPhone, Jony Ive, just left Apple Read More Chief Design Officer... Apologies — Make that Sir Chief Design Officer. British-born, fully-knighted Jony Ive is leaving Apple after 27 years to start his own design company (it'll be called "LoveFrom," inspired by this Steve Jobs quote). Apple assured us in its press release that Jony will keep working with Apple — Shares only dipped 1% after the news because it'll be one of his first clients.
Something you're touching today... was probably touched by Ive and his Bauhaus-inspired commitment to "less is more." When Jobs returned to Apple in 1997, the company was just clicks away from bankruptcy. That's when Jony became Apple's spirit animal by designing these masterpiece devices:
iMac desktop (1998): The OG-Starburst colored ones that took over your school's computer lab. He also did more recent MacBook Airs.
iPod (2001): The circular scrolling was a game-changer. He also did the (adorable) iPod Mini.
iPhone (2007): Apple's greatest commercial success. He also led the teams on the iPad and AirPods.
A smooth voice: He's known for divine British narration.
Apple's "neo-futurist" campus (2017): Ive stepped away from product innovations to design the spaceship-ish new Apple HQ building.
The Takeaway:Apple needs to schedule a Genius Bar appointment for itself... 2019's been rough and shares are only up 8% over the last year. Slowing iPhone sales and the trade war with key manufacturing partner China have been a problem. The departure of its Apple Store retail chief and now its Chief Designer don't help.
Jul 23, 2019
Apple is reportedly buying Intel's chip business for $1B Read More "I hate that chip store... I wish there were another in town." That's the thinking behind Apple's reported interest in acquiring the smartphone chip division at Intel. Intel is/was really good at making computer chips, but not so good at mobile chips for smartphones. Here's Intel's rocky relationship with Apple for the iPhone:
2007 — 2016: Qualcomm was Apple's go-to modem provider.
2016 — April 2019: Apple put its arm around Intel, hoping it could offer the same chips as Qualcomm for a lower price.
April 16, 2019: Apple begrudgingly settled lawsuits with Qualcomm, and agreed to use its chips again for at least 6 years.
Also April 16, 2019: Since Apple broke up with it, Intel announced it was done with smartphone modems.
We're talking about the "bottleneck"... iPhones start as raw materials and end fitting nicely on your palm. In between there's a value chain, including workers, factories, stores... and modems. Qualcomm is the only chip company able to offer the modems for 5G phones, so Apple has no choice but to work with them.The Takeaway:This is about busting Qualcomm's bottleneck... Qualcomm's stock fell 3% after the WSJ's report — if Apple's able to resurrect Intel's patents, research, and engineers into a functioning 5G chip assembly line, Qualcomm will lose the power it has over the iPhone. If not, Qualcomm will keep naming its chip price.
Sep 24, 2019
Apple decides to keep Mac Pro production in the US Read More Macs are bigger in Texas... Apple will not move Mac Pro desktop production to China, like it had reportedly been planning to. It's another "supporting America" move that Apple's PR team loved announcing. But this one has a scent of trade war diplomacy that investors were into — Apple stock rose almost a half percent on the decision.
Keep Austin weird and wired... Your Mac Pro smell like brisket? It's one of the few Apple products not assembled in China — it's made in Austin, TX since 2013. But this past summer, that almost changed:
President Trump's new tariffs made Chinese parts used in the Mac Pro more expensive to import to the Texas assembly line.
So Apple was reportedly thinking of moving the whole production out of Texas to China — the opposite of what Trump wanted.
Then last week, the Trump Admin exempted 10 Apple parts that would've been hit with tariffs — so Apple agreed to stay after all.The Takeaway:The transactional states of America... The new tariffs would've cost Apple $$$ (American companies that buy Chinese stuff pay for tariffs, and often try to pass that on to you and us by raising prices). Instead, Apple essentially threatened to move jobs outside the US. Then it got the tariffs waived by the Administration. This is the nature in which companies and countries handle relations with President Trump, and vice versa.
Aug 29, 2019
Fitbit snags a trick from Apple: Premium Subscription Read More Manning vs. Brady. Jordan vs. Kobe... Fitbit vs. Apple. Fitbit's only product competes with the iPhone maker's 4th most important product (Apple Watch). But the fitness tracker pioneer just announced Fitbit Premium — the new subscription concept hopes to more money every month off users who already paid for a Fitbit. It's a trick out of Apple's book.
Put me in, coach... For $10/month, your fitness tracker will crunch some artificial intelligence and tell you what to do — it analyzes your activity, diagnoses your "problems," then guilts you into changing with "solutions." And it's got a menu of 9 health programs to choose from, like "Healthy Habits" or "Get More Zzz's." Think of it like this:
Your old Fitbit wearable: It just showed that you only did 683 steps today. That's it. It counted.
The new Fitbit Premium service: Nudges you to go for an 18-minute walk at 2pm since you haven't moved in hours. Then it "encourages" you to join a 30-minute mindfulness course to clear your head before dinner.The Takeaway:Are we at #SubscriptionSaturation?... Add "digital AI health assistant" to the list of things you're coughing up $10 monthly for. On top of your Netflix, Spotify, and Blue Apron subscriptions, Fitbit's adding to the subscription-obsessed tech-meets-wellness trend we're seeing elsewhere:
Fitness: Peloton's about to IPO, charging $39/month just for videos of spin classes. And OG gyms do the same thing (physical gyms matter, too).
Wellness: Calm and Headspace charge $60 and $96 per year for meditation audio. Like podcasts, but for your deep brain.
Jul 17, 2019
Apple may be deep-diving into podcasts — because Spotify caught up (fast) Read More Pause... Apple is actually getting serious about podcasting after years of complacency. Bloomberg reported that the original home of the podcast is switching its strategy from reactive to proactive — it's contacting podcast producers, asking them to go exclusive with Apple: Shows only for Apple Music subscribers.
50%-70%... That's the share of podcast listens that happens in Apple's podcast app. The rest are divvied up between platforms (Stitcher, Google Music), so Apple got complacent. It didn't give creators much data about their listeners, and it didn't give listeners a great interface for audio enjoyment. Then Spotify started to catch up. Fast. Here's how:
Big goals: CEO/Founder Daniel Ek announced he wanted 20% of listening on the streaming platform to be non-music content.
Big acquisitions: So Spotify bought podcast producer Gimlet and its 29 original podcasts in February, followed by 2 other pod-cquisitions. It's committed $500M to the initiative.
Big results: Spotify is now 2nd to Apple, jumping from near nothing to 10%-20% of listens.
Spotify shares fell 2% Tuesday on word of Apple's moves.The Takeaway:Apple used to create, now it follows... With iPod, iPhone, iPad, and Siri, Apple built entirely new product categories. Now it's playing catch-up. Here are its recent 2nd-mover moves:
Music streaming ➡️ Copied Spotify
Apple TV+ streaming ➡️ Copied Netflix
Beats & HomePod speaker ➡️ Copied Bose twice
Original podcasts ➡️ It might just be copying Spotify again
Jul 31, 2019
Apple is no longer an iPhone company — and the stock jumped 4% Read More 'Siri, what am I?'... Not an iPhone company. After years of dominating Apple's financial statements, a milestone was just hit: The iPhone now makes up less than 50% of Apple's sales for the first time since 2012. Big moment. Let it sink in. And the next iPhone coming this fall probably won't have the futuristic 5G internet-of-everything network (it's not coming until 2020 for Apple).
Apple is now a 2-part company... iPhones vs. everything else.
iPhone sales fell 12%: ⬇️That number is way down because the price has surged to "should-I-just-get-a-laptop" levels, and people don't feel the need to iUpgrade as often.
Everything else (especially accessories) jumped 17%: ⬆️ Mac, iPad, wearables, and services (Apple Music, Apple News+) are helping drive recurring revenues.
Fun fact: That wearables biz? It includes AirPods and Apple Watch. And the whole wearables division is now the size of a Fortune 200 company.
The Takeaway:Apple has 1 innovative new thing right now... (and we already kinda knew about it). The joint credit card with Goldman Sachs. We now know the titanium-clad (there's also a digital version) humble-brag collaboration will arrive in August. In Apple's world of slowing iPhones and growing services, it's creatively focused on privacy:
There's no card number — it updates with a new one every transaction so even Goldman can't track your shopping.
And it doesn't sell that data to anyone else.
Plus, it's all 2-factor authenticated — aka finger or facial recognition.
May 7, 2019
Apple bought over 20 companies in the last 6 months Read More nbd... In a weekend CNBC interview, Apple CEO Tim Cook casually dropped this: "So we acquire a company on average, every two to three weeks." He went ahead and connected the mathematical dots for us — Apple has bought 20-25 companies since November by Cook's estimation. And only about 6 of them have been reported on.
With great cheddar comes great responsibility ... Apple is only required to announce acquisitions that have a material impact on its business. None of these smaller ones apparently have. But investors aren't worried about the price, since Apple boasts $225B in cash as of last quarter's finish — There's pressure to spend it on things that will grow the business, or return it to investors as dividends.The Takeaway:Apple's using acquisitions to play catch up... Its iPod and iTunes changed music, but Apple fell behind in streaming — So it bought Beats in 2014 ($3B) and Shazam in 2018 ($400M) to catch up. The latest buying spree of tiny companies looks like subtle moves to beef up Siri (she trails Alexa and Google Home in some digital assistant rankings). These 3 specific recent acquisitions sound like Siri-enhancers:
Laserlike: Machine learning — Teach Siri to understand humans better
Silk Labs: AI software — Improve Siri's brain
PullString Voice applications — Improve Siri's hearing
Aug 1, 2019
Spotify hits 232M users globally — but podcasts were the star Read More Turn it up... Shares of Swedish music streamer Spotify dipped on word it added fewer paying subscribers last quarter than expected. Here's what Spotify's 232M-strong moshpit of "monthly active users" looks like:
The freebies: 129M (up 27%) tolerate an ad every few songs so they don't need to pay any cash money.
The premiums: 108M (up 31%) pay monthly for ultimate listening control.
Average revenue per user: $5.42. That's a combo of ads and monthly subscription, and it's been declining as Spotify entices broke college students to sign up.
Growth is strong, young Skywalker... CEO Daniel Ek believes his company's 31% user growth is double Apple Music's growth rate. And the percentage of users who canceled their subscription — aka the "churn rate" — hit a record low 4.6%. It's still making a loss though as it focuses on the race against Apple for eardrums.The Takeaway:It's not music. It's "listen"... Spotify prioritized podcasts for key reasons. First, it's easier to work with pod creators than 4 powerful record labels representing most music artists. Second, Spotify's pod listeners stay in the app longer (and we assume are better looking). So Spotify acquired Gimlet's collection of pods in February, along with 2 other pod-cquisitions. Add in some in-app nudging and Spotify has doubled its number of pod listeners since the start of 2019.
PS: You can "festify" the stuff you listen to into a music fest-style lineup poster (don't know how Les Mis soundtrack got in there).
Sep 26, 2019
Amazon challenges rivals with Alexa-infused everything (and a 1-mile-radius tech cloud) Read More So. Many. Connected. Gadgets... Another Alexa-palooza arrived yesterday from Amazon HQ in Seattle. Bezos & Co. whipped up 15 Alexa-fluent devices. Some totally new, some just improved:
Echo Studio: A $199 smart speaker, challenging Apple HomePod and Sonos (the speaker icon's stock fell 5%).
Amazon Sidewalk: Basically extends your wifi signal 1-mile for low connectivity devices, like a dog tag (aka "Echo Fetch").
New voices: Samuel L. Jackson is voicing over Alexa, with more celebs to fill the airwaves (each costs $0.99).
Apple & Google have 1 advantage in the voice assistant wars... Smartphones — you've probably got Siri (iPhone) or Google Assistant (Android) in your pocket. Now you can take Alexa to-go:
In the car: GM announced all models will support an Alexa app.
In your ears: Echo Buds — The AirPod knockoffs are cheaper ($129), but don't look as sharp.
On your face and on your finger: Echo Frames and Echo Loop let you ask Alexa questions and listen for her responses through glasses and a finger ring (these last two are so new they're available by invitation only).The Takeaway:Alexa's goal = make you 1% more Amazon... These devices might not make Amazon money at first. Long-term, Amazon's putting Alexa everywhere so you're that much more likely to be loyal to Amazon or even order through Alexa via voice (aka "v-commerce"). If the percent of your paycheck going to Amazon rises from 20% to 21% because of Alexa, that's a win.
Jun 3, 2019
Everything you need to know about Apple's big annual event Read More Cue the PowerPoints... Apple's multi-day here's-what-we've-been-working-on Worldwide Developers Conference kicked off in San Jose. Apple's operating system got some big updates (spoiler alert: "dark mode" is coming to your iPhone), but these are our 4 highlights.
A SciFi-ish show: The 1st original show for Apple TV+ (its paid video subscription) will be For All Mankind — An alt-history where Russia lands on the moon first (here's the trailer).
End awkward earwax: Share the music you're listening to by holding your phone next to your buddy's (like AirDrop) instead of sharing/trading headphones.
Hello, Siri: She's getting a more "natural" sounding voice and will work better with AirPods.
Goodbye, iTunes: Since '01, iTunes has delivered you everything media-ish. Now it'll be split into 3 separate apps — Music, Podcasts, TV (like it already is on the iPhone).
But 1 update is (subtly) the biggest... “Sign In With Apple.” Bought a succulent online lately? You probably experienced "1-click sign-in with Google or Facebook" options (looks like this). Using your FB or Google creds logs you in faster, but you feel like you're giving up privacy/security. Apple thinks it's better than its tech rivals — Face ID tech can log you into anything more safely.The Takeaway:The next tech battle is privacy... and Apple is positioning itself as the savior. It hasn't suffered Facebook-style privacy leaks, CEO Tim Cook proactively calls for more regulation, and Apple keeps your data locked down on your device with encryption (it doesn't need personal data to sell ads). This conference shows it's wrapping its brand all around privacy. 
