00:00We do have those Apple results, Romain, coming in through right now. It looks like first quarter revenue is going to be beating estimates. First quarter revenue coming in at $143.76 billion. That is ahead of the estimate there for $138.4 billion. Also looking like a beat when it comes to EPS as well.
00:20Yeah, I'm going to go through some of the percentages here because this is kind of the similar story that we've seen in past quarters. Top line revenue up 16 percent in the quarter. iPhone revenue up 23 percent. Mac revenue, that's down 7 percent year over year. Of course, we heard from Mark Herman and some other people at Bloomberg saying that there will be a refresh of that. iPad revenue up about 6.3 percent. Wearables revenue is down. I don't know if you had actually gone through the greater China revenue or not, Katie, but we look at that.
00:49That's up 38 percent to $25.53 billion. Margin expansion as well, looking at roughly about 19 percent growth on gross margin.
00:59Yeah, really interesting to see these numbers come through. And, you know, at a broad category level, it looks like a bunch of beats across the board.
01:06You can see that reflected in the share price now higher by about two and a half percent here.
01:11A lot of questions, though, about what is going on when it comes to the strategy product versus software and, of course, what the AI outlook is.
01:20So let's ask some of them now to Walter Pysik. He is TMT analyst and co-founder of Lightshed Partners.
01:26I'm pleased to say that he joins us now. And, Walter, you've had a couple of minutes, a second or two to take a look at these results.
01:34As I said, when it comes to revenue, when it comes to EPS, when it comes to iPhone revenue specifically beats across the board, what do you make of it?
01:43I mean, I haven't had a chance to really delve into where the numbers are.
01:47But obviously, in 2025, you've had this situation where the replacement cycle has stopped lengthening.
01:54It was a 10-year lengthening of the replacement cycle.
01:57So now we're going into 2026 and what the next product is and where the company is really going to be positioned in terms of AI.
02:06AI has been this kind of overhang on the stock that even, you know, as you can see that even though they've done well in recent quarters in terms of revenue growth on these lines
02:15that you were just identifying even for this quarter, you've seen a contraction in the multiple, an underperformance in the market,
02:21and the stock obviously starting off the year down because of the continued concern.
02:26I actually would have thought that the deal that they did with Google in order to, you know, develop an AI strategy,
02:34which is now multiple years in delay, would have helped to buoy the stock more.
02:39That was the big overhang on them.
02:41Can I just stop you there, Walter, on that point, though?
02:44I know we have to wait for the conference call to get a little bit more details, and I assume they'll be asked a lot about that.
02:49But do you see that being a potential boon to them, assuming they actually execute on it?
02:53I know there's a lot that we don't know in the details.
02:56I mean, yeah, if they execute well and you turn Siri, which could be a very personalized assistant for the consumer,
03:06that can certainly help them.
03:07You know, if they don't have an AI strategy and we move towards agentic, and I think you just saw this week where the Chrome browser and the Gemini assistant
03:16is now going to do more things than it did, you know, just a week or two ago.
03:20And even what was added to Chrome was not that long ago, where you could have some Gemini integrated.
03:27If Apple doesn't come up with an AI strategy and there's better agentic features in Android,
03:33that is a long-term existential risk to the market here.
03:36Not only to go to Android, but obviously you've heard a lot of dialogue about additional, you know,
03:41ways that we're going to communicate with our data.
03:43Even, you know, I think Mark Gurman had a story about how Apple's coming out with their own pin,
03:48or maybe it was someone else at Bloomberg, very responsive to the rumors in the market
03:54about what OpenAI and others are developing.
03:57Why?
03:58Because we're in this, you know, this technological change where how we're going to interact with our data
04:03is going to be very different, I think, five years from now than what it is today.
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