Transcript of Apple’s earnings call, and one vexing question

Shoutout to the community-minded Jason Snell and Serenity Caldwell for capturing the transcript of the earnings call, as they do. Thank you both.

On the call, one particular question that is getting a lot of discussion:

Steve Milunovich, UBS: Some investors are antsy that Apple’s not acquired new profit pools or introduced a financially-material new product in recent years. The question is: A, does Apple today have a grand strategy for what you want to do? I know you won’t tell us what it is, but do you know what you want to do over the next three to maybe five years? Or is it more a “read the market and quickly react”? And B, do you have any sense of — we’re kind of in a gap period where the technology and, arguably, what we’d call the next job to be done, haven’t yet aligned, and maybe in a couple years we will see this flurry of new products and it’ll sort of match what people want to do, but it’s not quite here yet.

And Tim’s response:

We have the strongest pipeline that we’ve ever had and we’re really confident about the things in it, but as usual, we’re not going to talk about what’s in it.

Steve’s followup:

But in terms of your approach, I guess, to new products? Do you have a strong sense of where the technology’s going and where you’re going to play, or is it still enough up in the air that you’re willing to react fairly quickly, which, arguably, your organization allows you to do for the size of the company you are?

Tim:

We have a strong sense of where things go, and we’re very agile to shift as we need to.

Everyone, including Apple’s competitors, wants to know what Apple has up its sleeve. On one level, there’s doubt being expressed as to whether Apple has anything significant up their sleeves at all (as always, Apple is doomed). And on another level, there’s curiosity as to the specifics of what’s coming.

Why ask? Either way, Tim is not going to tell you. And in my opinion, it’s foolish to read anything into Tim’s answer. I believe that Apple has much more in the works than a car and TV content, more than anyone outside the company has seen. I believe that Apple, behind the scenes, is rapidly skating to where the puck is going to be, not reacting to existing market conditions.

Thanks again to iMore, Serenity, and Jason for pulling together this transcript. It makes excellent reading.



  • Mo

    “Tim, I’m cranky and bored with mature consumer products that last longer than six months. Can you dangle something shiny in front of my baby-food-stained little face?”

    • Caleb Hightower

      Took the words out of my mouth.

    • HA!

    • I’d only add something like, “and it doesn’t have to make money immediately. Like many of Google and Amazon’s projects (but unlike Apple’s), it just needs more…cowbell.”

  • GlennC777

    It’s a very good question. Apple’s real genius over the years was innovating unpredictably (and therefore disruptively). Nobody predicted the GUI, the iPOD/iTunes combination, or anything at all like the iPhone. These are still the bases for every Apple product and for Apple’s extraordinary success.

    The things Apple is reputed to be working on now – cars, car OSes, TV, AI, VR etc – don’t fit into this type of unpredictable/disruptive mold: they represent a much more conventional sort of “linear” innovation.

    In my opinion there’s no doubt that Steve Jobs had a particular genius for understanding how pieces could be put together in completely new ways to make a product that would change the way people live, and I’m not sure there is anything like this at Apple today. I know this is sort of something you’re really not supposed to say in the Apple world, but I think it’s important and possibly true. I think this is the area Steve was fishing around in and totally fair game.

    • EVula

      “The things Apple is reputed to be working on now – cars, car OSes, TV, AI, VR etc – don’t fit into this type of unpredictable/disruptive mold.”

      Well yeah, if you strip it down like that, of course there’s nothing revolutionary about any of what they’re rumored to be working on. If that same degree of pessimism gets directed towards their past products, the iPod was just a music player (and one with less space than a Nomad, ugh, so lame), iTunes was just another audio player on your computer, and the iPhone was just a cell phone.

      • GlennC777

        I don’t think so. Those three past products specifically really did come out of thin air in a sense. I remember when the iPhone was rumored, and everybody just thought it would be a another phone, with number buttons like every other phone had had since the rotary days. When it appeared it was quite shocking what they’d done. It changed everything.

        It could be that their version of a car or of VR will be similarly shocking, and not merely the kind of predictable linear innovation that I think everybody is sort of expecting, but that, to me, is the question. I don’t have the answer, just saying it’s a useful and important question to ask.