Apple to Announce Q3 2023 Earnings on August 3 Following New Macs

[DocMultimedia]

I used to have Apple stock, but ditched it all after their deliberate slowing of iOS on older devices shenanigans. At a certain point, their disgusting moral behavior became too much to stomach, earnings be damned. And their behavior has only worsened since.

At what point does a company's behavior become so awful, that it doesn't matter how much money you receive? I guess for some people, if a company were throwing people into volcanos on live TV for the huge ratings, that would still be fine, so long as their portfolio continued upward.

Are the people dead or alive before they are thrown in? That makes a big difference in my choice.

In any case, I don't view Apple as an evil company, and I own a bunch of AAPL. This date feels a few days later than usual...I think I'll look that up.

 

[CWallace]

I am confident Apple is still continuing development of the "Extreme" SoC for the Mac Pro, and I believe this is why they still went forward with announcing it at WWDC rather than just decide to quietly shelve it and point people to the Mac Studio or Windows/Linux PCs.

We know the "Extreme" didn't pan out as a shipping-ready product on first-generation 5nm (M1) and I am not surprised it didn't work on second-generation 5nm (M2) either. It might not even be ready for first-generation 3nm (M3), but it might be ready for second-generation 3nm (M4).

 

[257Loner]

PCIe slots are still orders of magnitude faster than Thunderbolt and Thunderbolt hubs do not address that problem, nor does a machine with dual 10 Gb/e Ethernet. Neither support 100 Gb/e, as a simple example.

And yet Thunderbolt hubs are a fraction of the $3000 premium one pays to upgrade from the Mac Studio to the Mac Pro. People and businesses aren't going to pay an extra $3000 if they don't have to.

 

[CWallace]

And yet Thunderbolt hubs are a fraction of the $3000 premium one pays to upgrade from the Mac Studio to the Mac Pro. People and businesses aren't going to pay an extra $3000 if they don't have to.

You are correct, they will not do it unless they have a compelling reason to do so.

And that is the point some of us have been trying to get across - customers who will be willing to spend that premium for those slots have many PCIe cards, not just one or two. And the aggregate value of those cards are in the tens to scores of thousands of dollars, not a few hundred dollars.

 

[257Loner]

You are correct, they will not do it unless they have a compelling reason to do so.

And that is the point some of us have been trying to get across - customers who will be willing to spend that premium for those slots have many PCIe cards, not just one or two. And the aggregate value of those cards are in the tens to scores of thousands of dollars, not a few hundred dollars.

I hope the people who use those cards will be able to use them for years to come. As much as Apple wants to support their loyal Pro customers, they will be forced to discontinue the Mac Pro if it doesn't sell and make a profit. If Apple allowed their iconic iPod product line to be replaced by iPhones and Apple Watches, despite all sentimentality and icon status, because it made the most business sense, then no one should disbelieve that Apple will replace the Mac Pro with the Mac Studio once the Mac Pro is no longer profitable.

 

[Aston441]

Are the people dead or alive before they are thrown in? That makes a big difference in my choice.

Good point. I hadn't considered that.

 

[I7guy]

I used to have Apple stock, but ditched it all after their deliberate slowing of iOS on older devices shenanigans. At a certain point, their disgusting moral behavior became too much to stomach, earnings be damned. And their behavior has only worsened since.

At what point does a company's behavior become so awful, that it doesn't matter how much money you receive? I guess for some people, if a company were throwing people into volcanos on live TV for the huge ratings, that would still be fine, so long as their portfolio continued upward.

What deliberately slowing down iOS devices? What behavior has worsened since then? The rest of the post hyperbole.

Good you put your money where your mouth is, but dang the lost earnings.

 

[jayducharme]

Interested in hearing how the Mac Pro specifically performed, given how much they seemed to have shafted it for the sake of Silicon

Marques had an interesting take on Apple's design choices:

 

[gund1234]

The main drivers of significant demand are over: remote work, M1, and bright economic outlook. I doubt M3 will bring anything significant in terms of driving sales. The current numbers are about what we should expect from now on.

Mac Pro and Mac Studio are serious content creation machines. The vast majority of consumers buy MacBook Air and that product alone likely outsells the desktops several thousand to one.

Most people need M1 MacBook Air for work & home use, few people who use laptop for video & photo editing would need more powerful processors.

 

[gund1234]

I used to have Apple stock, but ditched it all after their deliberate slowing of iOS on older devices shenanigans. At a certain point, their disgusting moral behavior became too much to stomach, earnings be damned. And their behavior has only worsened since.

At what point does a company's behavior become so awful, that it doesn't matter how much money you receive? I guess for some people, if a company were throwing people into volcanos on live TV for the huge ratings, that would still be fine, so long as their portfolio continued upward.

deliberate slowing of iOS, this was years ago, and we don't know if this was deliberate, but they fixed this issue years ago, until recently i was using iPhone 6S, it was working fine as my daily driver, so iOS is optimized to run on older devices.

 

[Alan Wynn]

And yet Thunderbolt hubs are a fraction of the $3000 premium one pays to upgrade from the Mac Studio to the Mac Pro. People and businesses aren't going to pay an extra $3000 if they don't have to.

Mac Mini's are a fraction of the price of Mac Studios. People and businesses are not going to pay that premium if they do not have to either. I am not sure I understand your argument. If they had made the machine $1,500 more would people who had no need for that functionality all of a sudden have said: "Wow, it is only $1,500 more, I should just buy it even though I have no need for it!" It is a niche product, and has been for a long time. This does not change that.

 

[Allen_Wentz]

Once the Mac Pro is discontinued, there is nothing stopping Apple from releasing a Dual Ethernet Mac Studio, obviating the last meaningful advantage the Mac Pro has over it right now.

Not true IMO. The Studio is a superb box at the high-middle range of performance it is engineered to provide. It presents an intended range of performance and control of heat production. The Mac Pro presents the next intended range up of performance and control of heat production.

Currently the MP is shy on performance upgrade but IMO that is likely temporary, just awaiting M3. The MP box is beautifully engineered to house extreme performance and control heat production far above the range Studio is design engineered for.

Just wait until the next generation and a Mac Pro performing at a higher level of performance correlating to its superbly engineered enclosure will present.

 

[Allen_Wentz]

I hope the people who use those cards will be able to use them for years to come. As much as Apple wants to support their loyal Pro customers, they will be forced to discontinue the Mac Pro if it doesn't sell and make a profit. If Apple allowed their iconic iPod product line to be replaced by iPhones and Apple Watches, despite all sentimentality and icon status, because it made the most business sense, then no one should disbelieve that Apple will replace the Mac Pro with the Mac Studio once the Mac Pro is no longer profitable.

IMO you misconstrue the solid business logic of $3T Apple. Without iPhone et al. Apple still is the fourth largest - and most successful - personal computer vendor in the world. Macs are a line of personal computers, and such a line has multiple product points of which Mac Pro is one product in the mix.

The integrity of, product research, etc. includes all the products in the line, and IMO the top product and research around the top product are far more important than simplistic profitability of that very small part of the product mix that MP represents.

So no, Apple will not "replace the Mac Pro with the Mac Studio."

 

[bgillander]

And yet Thunderbolt hubs are a fraction of the $3000 premium one pays to upgrade from the Mac Studio to the Mac Pro. People and businesses aren't going to pay an extra $3000 if they don't have to.

Wait, are you saying it is logical for a business to go through an external box to hook up their interface cards even if it slows their entire business process, just to save a couple of thousand dollars?

I get that the need for slots is not common, but if there is a need, the $3000 is not much of an issue. The main problem is that often that need was for external GPU, and Apple has a fair bit of work ahead in eliminating the need (or perception of need) for that.

 

[Alan Wynn]

Wait, are you saying it is logical for a business to go through an external box to hook up their interface cards even if it slows their entire business process, just to save a couple of thousand dollars?

What most of these people are really saying is: “I do not have or understand the use case for PCIe slots, therefore there is none.”

 

[CWallace]

I hope the people who use those cards will be able to use them for years to come. As much as Apple wants to support their loyal Pro customers, they will be forced to discontinue the Mac Pro if it doesn't sell and make a profit.

One of the reasons the Mac Pro costs $3000 more than a Mac Studio is "margin premium" to account for low sales volumes.

And I do believe Apple continues to work on developing an "extreme" SoC for the Mac Pro and eventually they and TSMC will arrive at a fab process that allows it to be made economically.

 

[ignatius345]

What that context is, however, is Apple makes more money in selling computers than they ever have in the 1990s, 2000s & up to 2010 just before Jobs's death, even adjusting sales to 2023 dollars.

iPhones just sell that much. The computers aren't chopped liver.

It may well be a relatively small slice of the pie, but don't forget that the pie is E-N-O-R-M-O-U-S!

That "small" Mac slice is still bigger than most other companies in their entirety. It's also extremely important to Apple's credibility as a company.

Fair points! But Apple is a very different company than it was when the success of Mac sales was life or death. Priorities are different as the percentage of income derived from the Mac has dropped precipitously. For example, they no longer need to chase the pro workstation market the way they did 15 or 20 years ago, so when we see something like a Mac Pro that doesn't live up to actual Pro expectations -- or it takes a while to deliver a big-screen (and probably expensive) variant of the iMac, I don't think should be a huge surprise. Pandemic panic aside, the PC market is not growing at a huge rate anymore. And people arguing that some spec on the Mac Pro is going to move the needle on AAPL stock... that doesn't really align with reality.

All that said, I think generally Macs are in the best state they've been in a long time. Apple Silicon breathed new life into the machines, "thin at any cost" designs have been balanced with actual user needs, and we've even got usable keyboards on our laptops once again. Like every Mac user I've got my wish list, but I'm not incensed when things take a while to materialize.

 

[257Loner]

IMO you misconstrue the solid business logic of $3T Apple. Without iPhone et al. Apple still is the fourth largest - and most successful - personal computer vendor in the world. Macs are a line of personal computers, and such a line has multiple product points of which Mac Pro is one product in the mix.

The integrity of, product research, etc. includes all the products in the line, and IMO the top product and research around the top product are far more important than simplistic profitability of that very small part of the product mix that MP represents.

So no, Apple will not "replace the Mac Pro with the Mac Studio."

So you believe Apple is selling the Mac Pro as an image builder and loss leader, like the 1950s Chevrolet Corvette? I will admit that the Mac Pro looks impressive. But Apple is beholden to their shareholders, and what will Apple do if their shareholders find out that no one buys the Mac Pro anymore? Sell it at a loss forever? Not if their shareholders complain enough.

 

[Alan Wynn]

But Apple is beholden to their shareholders, and what will Apple do if their shareholders find out that no one buys the Mac Pro anymore? Sell it at a loss forever? Not if their shareholders complain enough.

I have no idea how much it cost to build the Apple Silicon Mac Pro, but given how little new work was needed, I would not be surprised if it was profitable with very low sales. However, given that it has been years since Apple released sales figures for any of its devices, I am not sure how their shareholders are going to know anything about its profitability. Remember, since it uses Apple Silicon that is also used in Mac Studios, Apple decides how it attributes costs to the machine. For example, they might only attribute those costs unique to the Mac Pro to it, rather than writing off a portion of the R&D for the chips used in other systems.

 

[257Loner]

I have no idea how much it cost to build the Apple Silicon Mac Pro, but given how little new work was needed, I would not be surprised if it was profitable with very low sales. However, given that it has been years since Apple released sales figures for any of its devices, I am not sure how their shareholders are going to know anything about its profitability. Remember, since it uses Apple Silicon that is also used in Mac Studios, Apple decides how it attributes costs to the machine. for example, they might only attribute those costs unique to the Mac Pro to it, rather than writing off a portion of the R&D for the chips used in other systems.

Sounds good to me. The story of the Mac Pro is the story of the silicon that powers it. If the silicon that powers the Mac Pro is competitive or offers a unique selling proposition (USP), then it may have a future.

 

[AAPLbuyback]

Q3 earnings preview: if you liked us at 23X fwd P/E and single digit rev growth half a year ago, you'll LOVE us at 30X fwd P/E and negative single digit rev growth...at even higher interest rates.

I'll save you the time: I commented that the stock was too high at ~170. Same thinking still applies. I don't own any Aapl directly, and I'm not trying to time it.

Another bad take on AAPL stock is not unusual.