Asymco One Office Hours Live Q&A with Horace Dediu & Gene Munster: April 8, 2026
A lively discsussion of Apple topics such as:
- Geopolitics: China concentration; Taiwan tail risk
- Financials: Solid near-term growth
- AI: Critical narrative shift; to be proven
- Growth Strategy: User expansion
- Business Model: Evolution: hardware → services → Personal AI platform
- Moat: Privacy + integration; trust
Recording
https://asymco.com/wp-content/uploads/2026/04/Asymco-One-Office-Hours-Audio-26-04-08-2.m4a
Transcript
Asymco Office Hours, April 8, 2026
©2026 Asymco. All Rights Reserved.
Farshad Nayeri
Hello, everyone. Welcome to the Asymco Office Hours. We are here with Horace, and we are elated to have Gene Monster with us on April 8th, 2026. Without further ado, let's get started. But Horace, you want to start us up?
Horace Dediu
Yes. First, thanks again to Gene for joining us. We've got about an hour. We want to make sure we use it wisely. And I'd like to touch on a few points. Gene, you just recently were on CNBC arguing, I guess, partly was a bullish note on Apple. You said that there was a great deal of opportunity remaining with personalized AI. You mentioned that they're probably going to figure that out, and we should be patient. But I think there's going to be an interesting, what I would call consumer AI, but you can call it whatever you want. But you also said they were vulnerable to geopolitical turmoil. We've seen plenty of that. In fact, today we're seeing the stock recover from a huge gap down yesterday, about 5%. It bounced halfway back during the day. Today it's bounced all the way back almost, I think so, pretty much. It's hard to tell right now. So that was just based on just the developments in the Middle East. But what are your, can you just tell us why you think Apple might be a little bit more vulnerable than, say, let's say the other usual suspects in, the geopolitical, um, problem?
Gene Munster
It starts from outside of my wheelhouse, which is the geopolitical side of things, but this view comes from someone within the U.S. military who I’ve recently heard speak, and they talked about the dynamics around conflict. Is that there used to be this kind of governing factor around human life? And as there's been more drones, more robotics, more cruise missiles as part of conflict, better targeting around taking out assets, as that happens, the view of this US military person was that we're just going to see more conflict longer term. And so I just kind of want to start there. Is that as of this recording, we're in a place where there is a little bit of a relief related to what's going on with the US and Iran? But when this gets sorted out, and I believe it will be in short order, there's going to be some other conflict down the road. And ultimately, when it comes to Apple, as Apple investors, the road to conflict ends at what happens with China and Taiwan. And as I was highlighting, investors think deeply about Apple and its relationship with China. And if we are in a world where conflict is more acceptable, then the probability that China makes a move on Taiwan increases. And the language that China is using on this is related to a peaceful reunification. And so whether it's peaceful or there's military force involved, I think does put Apple in amongst tech companies. I'm a big believer in what Apple is doing, but it's hard for me to even say this because it is a negative, is that they have a lot of exposure to China. Imagine what that relationship between U.S. and China, how that could be changed by what happens in Taiwan. Could there be some sort of restrictions in terms of products that are made in China coming to the US? How does that change Chinese consumers, which is 17% of Apple's business? How does that change their perception of Apple's brand? And so, I mean, the reality is, I believe that there's a debate about will we be in a world of more conflict going forward? And the timing around China and Taiwan, that's debatable. I don't think there's much debate around the topic that Apple is more tied to what's going on in China versus companies like Amazon or Google.
Horace
Fair. A couple of points back to you. I think that, one, I think Apple's not been, this is not a new thing. It's been under a lot of stress over the years. I think, however, though, it's got built-in mechanisms to deal with a lot of that. I think that's one of the aspects that I always call about being anti-fragile. It's like once you get tough enough and you become flexible as well, you can kind of absorb more damage than something that's, let's say, simply armored or protected with a skin that toughens up, but it doesn't once it's broken, it's permanent. So I think we've got to step back and not just look at necessarily what's going on day to day. We've got to think about strategically. I think Apple's had so much over the years. And we talked about this at the last event when we had, what was the name? Was it McGill, the writer of the book on Apple in China? And a lot of people have been worried about Apple in China. And I, too, have been very worried. But I think they've always had a plan. I think also moving to India is obvious. Moving to Vietnam is obvious. But these things take time. I also think, though, that Apple is operating in hundreds of countries, at least 175. Maybe hundreds is an exaggeration. But it's operating in a lot of countries. It's got a huge amount of supply chain redundancy, not just assembly. We're dealing with a lot of other components. There might be some single sources, but there's plenty of slack. So in many ways, I think it's about management. It's about mitigation. It's about also diplomacy. It's a lot of things that are going on. And a lot of people, someone said that, I think it was actually Warren Buffett. He said he couldn't figure out how Tim does it, but he seems to be liked by everybody.
Gene
Yeah, that comment recently jumped out at me too. And it's so true. And that is the superpower of Tim, and I think it plays well in this conversation because it is. It feels like it's kind of soft, fluff, but it's the substance. Some of the substance around Tim is his ability to kind of navigate this. Yeah. My question, Horace, is if you, like I do, do the math, we talked about the percentage of revenue that comes from China. That's straightforward. There's the question about all those different countries. Apple has different manufacturing relationships with them. There's how much Apple's revenue is manufactured or assembled in China. And I can kind of step through where I come up with this number. But from my perspective, it's about 40% of their revenue is manufactured in China. I agree that they can move more to India. They can move to the US. That does take time. And so this is not, from my perspective, like the geopolitical side is not like by any means the end of Apple if things do end up boiling over. But it is something that I think probably will take three years to kind of navigate their way to a point where there's some stability. And I would be curious in your take on that. Like if...
Horace
Yeah, well, first, let me just also touch back on one of the first points you made, which was made by a military person, which is that we are entering into a far new, far different warfare tactical environment, which means we're seeing a lot of robotics. We're seeing drones. We're seeing drones on the ground in the air. We're seeing drones on the water. We're seeing drones fighting drones. We're seeing all kinds of measures and countermeasures at a very, let's say, low-end scale, which actually fits very nicely with the theory of disruption. So when I was working with Clay Christensen back in the mid-2010s, he was saying how already 15 years earlier, he had argued the case to the Pentagon that the U.S. should focus on pilotless vehicles, which at the time we didn't call them necessarily drones. But these were prototype vehicles that didn't need a pilot. They could be remote-controlled. We got that with the Predator. But since then, we had essentially a low-end disruption. We've had, I don't know if you remember the beginning of the war in Ukraine, they were using a product called Bayraktar. It was Turkish. It was an MIT engineer who went back home to Turkey and developed a company that developed a drone that was using missiles to shoot at tanks mainly. It wasn't a kamikaze drone. It was a standoff drone. But it was so disruptive that everybody was making songs about Bayraktar, saying how it changed the game, and that there are only 10 available to Ukraine, but they made a huge impact in the first few weeks of the war. Soon after, it became obsolete because there were countermeasures against it. But then came the era of so-called FPV, or first-person view. These were drones that were guided to their target by a pilot who actually essentially remote-controlled it. So without getting bogged down too much, I've been following this for years and years. It's a clear disruptive game, but we can't predict how that plays out, especially when it comes to impact on, let's say, potential conflict between two nuclear powers, which is the United States and China. I think the more likely scenario, if I'm honest, is that disruption usually favors when you have an asymmetric situation. When you have a country like Ukraine versus a country like Russia, or when you have a country like Iran versus a country like the United States, you have a lot of incentives there for the little guy or the underdog to use tricks, dirty or not. But the idea for two major powers squaring off is that they tend to bring up their biggest weapons. And the problem with that for the U.S. and China is they're both nuclear-powered or nuclear-armed. And so the chances there is like no one's going to do a – they could be asymmetric warfare, but it wouldn't be like on the order of sabotage or using third-party proxies. Somebody who comes in and maybe hacks a power plant or something to that effect, and you can't quite trace it to the source. So the problem would be that a symmetric conflict would, people would back off and negotiate because it's, there's too much at stake. The powers are too big. It's much more it's much more likely that we're going to have regional conflicts as we've just seen two major ones. You're generous at giving me the mic initially, Horace.
Gene
And just to respectfully interrupt, I'm not suggesting the U.S. and China are going to be in direct conflict. I'm suggesting that there are topics that each of them is pursuing. And these countries are pursuing Russia with Ukraine, China, obviously, with Taiwan, the U.S. with maybe Venezuela, Iran. And so like these, but these like these, these other topics we'll call them, I think can cause kind of a stir and create some friction. And the basic take is at some point, China's going to take over Taiwan. I used to work with people who spent time with Chinese IPO companies and Baidu went public and JD and Alibaba and spent a lot of time over there and had a team that was from China. And I remember them always saying that, like, as kids, they was just part of history was that Taiwan is part of the motherland. That was the words that stick out in my mind. And so this is going to happen. And the question is, like, what does it mean for Apple? I mean, if we just fast forward to a headline that China has now taken over Taiwan, what does that mean? If you look at big tech, which of big tech is going to be most impacted? And my sense is it's Apple. NVIDIA would be hugely impacted by it, maybe more than Apple, but it would be a big impact. I do have one.
Horace
Well, let's hope it doesn't happen soon.
Gene
Well, I mean, the theory is that what's happened in the market and part of Apple's underperformance has been like the more the U.S. is involved in Iran, the more resources are used there, the more it supports this idea of kind of doing what you want to do. And I think that that's kind of that new kind of worldview between some of the biggest powers, whether it’s the U.S. and China doing what you want to do, I think kind of creates this environment. And so at the end of the day is that it's short term, quote, short term one to maybe three years. I do have one question. I don't want to get too off topic on the political side, but there was kind of this, these mystery drones. This sounds like I'm going down a rabbit hole. I forget the base that was in the US. This is a few weeks ago. And are you familiar with it? I mean, I should even know the name.
Horace
Sure, sure, sure. I heard of a few of these. There was an episode, I think somewhere in Texas, actually.
Gene
Okay, this is more like where the stealth bombers are kind of based at whatever that kind of primary base is, but the theory is that these drones have been out there, and it was an example of when it comes to big people, big countries kind of going against each other. The US is in this amazing position with Canada and Mexico and two oceans. And like one way that a country like China could kind of get the US to kind of wake up is to do something similar to what Ukraine was doing with Russia about sneaking some of the drones in a semi and then that surprise. I mean, that's kind of a little bit of a wake-up call. And I guess my point is, I'm not saying that that was that I think that did happen. There was some activity. But my point is that we're just in a new environment. Now, the good news about this conversation, the more this has been years, as you said, and the more this conversation happens, I believe the more desensitized Apple investors will be. If something happens tomorrow between China and Taiwan, Apple stock is going to act differently than if we talk about this in the next five years and something happens. And so I think that there is like this conditioning. The gold standard, the way I think about this is as an Apple investor, how do you sleep at night? And if you come to a point where you're comfortable about whatever some of the tension is on the story, as the market more broadly does, then it de-risks the impact of the stock. And so I just would mention that too, is that this is actually, this conversation is a healthy conversation. It's healthy just to call it out. Like, yes, there is this dynamic here. And I think it helps kind of toughen the stock up a little bit.
Horace
I agree. I agree. We definitely need to not just bury our heads in the sand and assume the best. Well, just moving back more on to the Apple itself. The quarter that's coming, the quarter just ended, and we're going to have earnings coming out in a couple of weeks. How do you see it? Any surprises you might expect, given we had strong guidance, We had more or less in line with the last quarter, maybe a little bit higher margin, which was a bit of a surprise to me, at least, given the environment of memory. But we had a couple of products come out. And so far, the news is very positive on the Mac. Ongoing momentum on the iPhone. I'm not sure we're going to see a surprise there. But are you revising anything based on the last few weeks?
Gene
I would say that there's to the I want to just the update is relative to the imprint number versus where some of the whisper numbers are. And the thing I look at most is what revenue growth is. And for the March quarter, they talked about 13 to 16% growth. And based on the fact set numbers, as of last night, the street's looking for just over 14% growth. And so not, I mean, very close to like the midpoint. Now, given Apple's history of coming at the high or better than the high end, I would have guessed that most analysts would have brought their numbers right to that 16% number. I didn't do this exercise, but if you look at the 50 analysts that report earnings estimates, my guess is that there's a group that just has not been particularly diligent at updating their estimates. And the reality is, is that the whisper number, those analysts that have updated their numbers are at that 16% growth. So that the official facts that street estimate, I think, understates what the expectations are. The last piece, I'd be curious, Horace, if you picked up any on this, I was on an investor call yesterday and they had mentioned some negative commentary from China on this on demand. And I wasn't able to find anything. I did find something that came out from CounterPoint that was published in the middle of March that talked about the China business being up much faster as something like low 20%.
Horace
I saw the same thing. I have not heard anything negative about China.
Gene
That's good. Let's take it as CounterPoint, I think, does solid work. And they were correct on the last quarter on the rebound in China. I think if you play this forward, just to answer the core question, I think that there is going to be upside. I think they need to provide upside, but I think there's going to be upside to that 16%. The good news is that for the June quarter, the street's looking for 10% growth. And so it sees kind of a nice step down. And I think what we're seeing with the iPhone is part because of some of the new products, the lower end phone. But I mean, this really is this 2021 21 upgrade base has come back in spades. I mean, it's exactly the cycle that we had kind of hoped for a year and a half, two years ago, it's being kind of split out over a couple years. But we should still see another few quarters of strength from that. And so when I think about the numbers more broadly for this year, I think I feel comfortable that the fundamentals, the numbers are going to be moving in the right direction. And so I want to say that like in the kind of in the pantheon of topics that are important to Apple investors today, I'd put kind of the quarter and the outlook as the second most important topic. Just to complete that story, I hope you can still see
Horace
me. I'm switching back and forth here to my model. But basically, I'm at 16%. But I have been there more or less since the guidance was put forward. And I think the only thing I changed some of the Mac numbers. We were not aware of the Mac Neo. We were not aware of this OpenClaw. OpenClaw is just cleaning the shelves of... They were aware of it, though. Well, they were aware of the Mac Neo, but I don't think they anticipated we were going to see a run on Mac minis. And so people running and buying these modular, effectively, desktop-type devices. It's a market that probably doesn't have a lot of slack in it. So I tweaked up a little bit my Mac estimate, but I'm still at 16%. And I think, if anything, we're going to see a little bit higher than their upper end. Just given the positive momentum we've seen across the board, a lot of positive. Also, maybe the only slight negative I heard was a slight deceleration in the U.S. in the growth on the App Store. Now, that was just a survey. And I think they're still pensive in 14%, which is what I have, for the services sector or services segment altogether. So I think it's going to be a very solid quarter. Like you said, the most interesting thing will be what they got going forward. The reason 10% seems ridiculous to me is what they did last year on the previous product cycle. And to see that growth not be a little bit higher this year, given what appears to be a great success story with the 17. I find that hard to believe.
Gene
So the 10% growth in the June quarter, you feel, is conservative?
Horace
I think that's conservative. It would be in line with what they've done in the past, with what would be considered much less exciting portfolio, right, overall. So unless something goes wrong with services, I think we're going to see above 10%. That's my take. We have a couple of questions. We're going to make sure we cover those. Farshad, do you want to tease us up here?
Farshad
Yes. There was a follow-up. I guess I will just read it. There was a follow-up on the China situation and about how much of Apple's manufacturing supply chain depends on what is your, in your opinion, how much of it depends on China versus Taiwan. And they have been working to move the supply chain off, but like how far have they gotten, including India and US? You guys touched upon it, but we got into the conflict part more.
Horace
Yeah, no, I don't think there's anything we can add, but except that these things take time.
Gene
I've gone back and looked at some of the ramp in the iPhone in India. Just use that because that's a bigger lever. And it comes down to, again, this metric about percentage of Apple's revenue that is assembled in China. It's gone from like 45% a few years ago to 40 now. So it has declined, but it's still overwhelmingly China.
Horace
Yeah, it's just a matter of timing here. And I think that it would be a tragedy for more than just Apple. It would be a lot of people. Oh, yeah. It would be a global recession, which is why, again, I think violence is to be avoided when major powers are at stake. And I think that would be a deal.
Gene
My guess is that it'll be a handshake deal, and it will be, quote, peaceful. And they'll allow the U.S. to get some momentum at building more fabs in the U.S. I mean, that's the part that, I mean, we've got oil in the Middle East, you've got chips in Asia.
Horace
Well, I'm not a fan of China as a political entity, but they took over Macau and Hong Kong, and those places are still functioning. So I think that there's a lot of reduction in freedom. I don't want to whitewash that, but it was not...
Gene
the the issue Macau's gambling Taiwan is AI and i think the issue is that there's what happens to the integrity of the chips that are produced there if it is something that is like a and how what does a peaceful reunification look like it looks like what happened in hong kong i mean there was a handoff but still hong kong kind of operated as its own and And then we had the protest, the umbrella stuff. And then it just kind of like just through them pulling different judges and changing leadership out, it just kind of morphed into being part of PRC. And so my guess is that's probably how it happens. But in order for that to happen, for the U.S. not to raise their hand and say stop, there needs to be some off-ramp or on-ramp, ramp-up of these advanced node production in the U.S. And that does take years. And that's kind of going on. I mean, we're starting to see some of that going on. And so like if the U.S. was able to manufacture all these advanced chips and get all the supply and Apple could get all of its chips, I hate to say it, but I don't think the U.S. would have much interest in Taiwan.
Farshad
So the next question is what markets and application domains should Apple invest in? Tim has talked about medical, but we haven't seen much. Home automation is another one. Apple has tried that, but they haven't had a lot of success. So what are the interesting new markets that Apple should invest in, in your opinion?
Gene
Horace, you want to take it?
Horace
Yeah, the two mentioned are pretty obvious, but medical is not a very big business as far as like, if you think of it as supplying the professional or the equipment business it's much more about devices for people that can be used to collect data. I think that's always been their strength. I think there was a note this morning about the display being good enough. What is it called? The latest display of being good enough for radiology. But that's a niche, tiny, tiny niche. You're going to sell a few thousand units that way. It's nothing. I think the... So I wouldn't ask this question. What I would say is how many more customers can they possibly harvest and how much more will those customers be willing to spend incrementally on new products and services? I think that the fact is that there's still and I'm still doing the analysis. It's a global analysis involving 200 countries, 20 years.
Gene
I can't wait to see this.
Horace
We're going to look at every country in the world and try to understand exactly how many people are using Apple products and how many are using which Apple products, because that's never been done before. And it's possible to get almost there. You know, might be a few assumptions, but we have a lot of circumstantial evidence. So when you look at that and you say India, there's probably a billion people there. Africa, at least half a billion addressable. There's a billion in total, but half a billion addressable, especially as they're possibly going to expand their portfolio to lower end, which is something I've been thinking about for 20 years, honestly. And so this is the fundamental question. Now, could there be more about home? Yes. And I think they're working on it. We've heard all kinds of rumors. There will be product there, but the home is very resistant it's not just apple look at google look at everyone else look at Alexa everybody's tried different angles in the home and at Microsoft was the first they went in with consoles they went in in the late 90s trying to figure out how to get the living room um the home resists being a container of hardware and software it's it's inherently going to stay dumb in my opinion and it's funny i used to say this about the car as well because the the more expensive things are the less absorbent they are of technology if you think about we we moved more technology onto our wrists than we moved in the last 20 years into our airplanes or if you look at the the technology in aviation the technology and in
Gene
And that's fascinating. It's because the upfront cost is so high, people don't want to switch it out.
Horace
It's complicated because of the life cycles. The life cycles of big items and the way they're purchased, the way they're financed, everything has to do with making decisions way up in advance and then trying to figure out how that's going to evolve. Most people will keep the refrigerator a lot longer than they'll keep a phone. They'll keep a house or a car at a different time schedule. So if a product designer wants to inject software into a house, it'll probably be obsolete by the time the house closes on its first sale. It's just too dynamic for these assets that are so slow to evolve. And this is fundamental. And it's a paradox, honestly, because so much capital is tied up in these fixed assets. So I could debate houses and cars forever. The medical stuff is also incremental. But I think these get you a little bit, they take you down the wrong path in your analysis because you don't end up really figuring out what Apple's strategy is. And it's mostly about the largest audience in the world.
Gene
When you asked the question, my sense went to personalized AI. And it's not like a new category in the sense of like it might not be, it probably will be some form of a new device, but the substance of the revenue is going to be existing products. and it so it doesn't feel as flashy and as exciting as kind of jumping into kind of the new thing again don't want to rule out there will be AI specific devices and we've heard a lot of rumors and patents around what apple is working on that but the basic concept i think of on the hardware side and and this also plays into on the on the services side where they can grow is just that idea of really creating a consumer AI device that works. And I mentioned that kind of the quarter was the second thing that's most topical, which I believe is most topical, should be most topical for Apple investors. The first is that when will Apple be perceived as having the chops in AI? And I think that that comes in the form of this personalized AI. We can talk more about it, but just want to leave kind of at the highest level that I think there's a real opportunity there to have a dramatic impact on our lives, how these devices are used by us. And no one's done it yet. There is no AI device out there that you tell your friends you need to buy. And that's going to come. And Apple's a great place to try to capitalize on that.
Horace
Yeah, the smartest device for AI is going to be the smartphone. But we'll see. what's next
Farshad
Okay so the next question is what has been and will be going forward the cumulative impact of Apple's stock buybacks on stock valuation over the 12 plus years since their inception
Horace
The question is what will be the impact or has been the impact I think it's already reflected in the shares by definition and there's fewer out there. I think I made a calculation that it'll take another couple of, maybe another couple of years, no more than two, I'd say, that we'll see half the shares at the peak, which is around 2012. And so that I've been tracking how the share buybacks has been concentrating wealth in the hands of the existing shareholders. And I think by definition, what you hold now is what what it's worth and it's um now sometimes the market doesn't react um it could take a while for that to finally settle into the into the balance but but that's been that's that's the mathematical logic of of um of the buyback is and not to mention that you you're remember you're getting dividends on those shares and the amount of money that's given out as dividends is now given to half the number of shares. So you're also getting double the real return to shareholding in cash that the company chooses to spend. So it's pretty simple mathematics. I think it's, but people get a little bit, I think there's a lot of emotion involved with these capital return programs that people are either saying that they're somehow a scheme or that they're hiding costs not effective yeah
Gene
gene i i defer to Horace on the math on it would just highlight that that's one thing that's pretty unique about apple is the amount of capital that they're still returning to investors and especially when you compare it to Amazon and Microsoft, Google and Meta, where effectively they're using all their free cash flow right now, which I think is the right call for them for infrastructure build out. And when it comes to Apple, you're still getting that kind of that subtle bump up with those share buybacks.
Horace
So let's move on then.
Gene
I'm good moving on
Farshad
There was a follow-up to the what product areas Apple could be in so Apple's strengths has been in consumer products so what do you think about the enterprise efforts they have with Vision Pro is that kind of outside of their
Horace
Their history so I'll take a run at this I think enterprise isn't just vision pro. Enterprise is also, I mean, they just relaunched Apple business. They they're tweaking here, things in there. It used to be a much, much bigger issue. The whole thing about orifices, the whole thing about supporting Intel. If you remember these religious wars we went through, people saying that as soon as Intel was supported, that Windows would run on Mac computers, it would run under, in its own sandbox but it it people said that would that was like a watershed event and some people even said who's going to ever run mac os when you've got windows it went the other way actually so a lot of people switched because they saw the mac as a better alternative but the the i i get the impression also that the the strategy with devices was that apple would convinced the CEO to carry an iPhone and maybe convince his or his or her spouse to to carry an iPad and as a result the children to carry iPads and as a result it kind of went and infiltrated the enterprise from the top instead of getting the IT people involved everybody just fell in love with the products that were consumer products and they started using them in the office and over over the decades, we've actually seen a lot of these anecdotes being brought forward by Apple management at these conference calls about Delta Airlines or some HMO just buying thousands of iPhones or thousands of iPads. And we're seeing these kind of almost like, as I said, they're like little stories. Nobody pays much attention, but it's been a continuous process of persuasion. And I would say a sort of a backdoor approach or a top-down approach instead of bottom-up. I don't know how to define it, but that's been their strength, not to deal with sourcing through IT. I will point out that if you're Dell or if you're HP or even if you're Microsoft, you're really only talking to about 500 people that matter. You're talking to the CIOs of the Fortune 500. If they decide to to standardize on your product. Their suppliers will have to standardize. Their supply chain, their forwards and backwards in the value chain are gonna all standardize because you're the gorilla. You're the biggest one in that value chain. You're the top 500 companies in the world. So you don't really have to persuade 30,000 companies to adopt Windows. They only have to persuade 500 companies. And that's what more or less Microsoft did in the 90s. They just, they convinced everybody to go Windows. Now, Apple is not going to sit around trying to convince 500 CIOs. I think that what they're doing is they're convincing at the time when I first said this, 500 million people to buy iPhones. So that's a million to one decisions in your favor. And now it's probably 1.5 billion people to use iPhones. And so that is far more interesting because they'll go to offices, they'll go to schools and they'll persuade people slowly. And at the end, it's the tail that wags the dog. At the end, the value of all those people's purchases actually begins to be bigger. IT used to be a bigger spender on technology, but now it's consumer. And Apple made the right decision. So I think enterprise today is kind of a little bit of an afterthought. And it's not as important, even in the mind of the kind of the PC world. To me, there's also a deja vu moment when we saw the Mac Neo, Because everybody who was like into the comparing PCs with each other, I forgot they actually did this. They do benchmarks on PCs. So, oh, my God, this new Mac, cheap, fast. What's this going to do to IT? Or what's it going to do? People are going to buy these like crazy in schools and so on. I said, they never bought Apple before. Why would they buy it now? Even if it's 10 times better and half the price. It's more about like what software is in use and what policies are in use. And then you wait 10 years. and suddenly everybody's using the Mac. Was this one singular thing or was it just the process of slowly eroding, slowly persuading, slowly getting people to come to you and not having to, by the way, the reason Steve hated going through the orifices was because you begin to think entirely to their needs, not to the end user. So in order to sell to 500 CIOs, you sell your soul and you're no longer easy to use. You're no longer fun. You're no longer innovative. And every time you want to make a change, you go back and ask them for permission. That was never going to fly. So I think it's working out pretty well for them.
Farshad
Gene?
Gene
Don't have much more to add. I agree. It's working out well. And again, I would say this wasn't part of the question here, but I want to make sure we have time to cover it. I think about Apple's growth. There's growth of the business, which generally can kind of be an indicator in terms of growth of the share price. And then there is separately what happens with the multiple, whether it's expansion or contraction. And I do want to take a minute and just talk about what I think is the A topic with Apple, much more important than the C topic that I started with, which was around China and the B topic earnings. I think the A topic is really changing Apple's narrative. And I want to, Horace, are you okay if I kind of go back and give a setup on this?
Farshad
Please do.
Gene
please do if we look what happens if we look at the biggest tech companies the the what are the levers that can get their businesses to get the stocks to go up so one lever is the business kind of accelerates and let's just quickly look at Nvidia for example is that a few weeks ago Jensen said at GTC that effectively he gave this trillion dollar opportunity back into its 40 plus revenue growth for next year calendar 27 the street was at 30 at the time but kind of a low end 40 and so the 30 was a high bar the 30 started out if we rewind nine months ago it was at 10 so it's gone from 10 to 30 now he's talking about 40. i mean this incredible increases but yet the stock really hasn't done much and so when we think about video like what's going to get the stock to go up imagine that they just say it's not going to be 40% growth, it'll be 60%. It's still this wall of worry. It's probably the numbers aren't going to really get it to lift that stock that much. And when it comes to a company like Google, for example, go back and look at the first part of calendar 25 was about concern that ChatGPT was going to take away time on search. And present company included, I felt that this was going to be a very negative moment for Google. And then they showed essentially that they had competency in AI, specifically to how they can channel AI mode and AI overviews into clicks on blue links and also their new models, the new Gemini 3, Nano Banana. They really showed investors, this is the second side that can get a stock to go up, is changing the narrative. They Search did grow a little bit faster than what people were hoping, which changed the narrative on search. But more importantly, they showed competency when it came to AI. They had the chops. Microsoft, more recently, has been stung in part by the concern about software, but also a concern that their AI products aren't that compelling. And I was a big believer initially on the power of CoPilot, but I can say as a Microsoft user, I rarely use CoPilot. In fact, I almost want to steer away from it because it ends up bringing my PowerPoints into places I don't want to go. And so when it comes to like Microsoft, it's less about getting kind of seats moving in the right direction and the software revenue. It's about showing, putting a stake in the ground and showing investors that they can create a killer. Tell me a killer AI product that Microsoft has besides Azure. I'm hard pressed to think of one. And then now we bring the conversation over to Apple. Like for Apple really to have a breakout for this to be a $400 stock, you have to have a change in the narrative. and that's pretty obvious that's the beauty of owning apple here is that the bar on AI's pathetically low as it should be given they have had i mean horse we know this company inside and out and like they haven't had misses like this let's call it like it is it's been a disappointment but if they can show that they can bring personalized AI and we can talk like what does that actually mean personalized AI but if they can show that they can create a compelling AI device, a compelling AI product, they can change the narrative around the stock. And I think it would be a meaningful unlock in terms of the multiple and also a smaller benefit, but a positive benefit to earnings. And so, like as an Apple investor, what I think you should be most focused on right now is what we see in June. And what we see isn't necessarily what we're going to get initially we learned that it would become out in stages but are they able to just do that very simple thing is this a feature are these features does this personalized AI unlock third-party apps and the ability for third-party apps to think independently and make your life better if they're able to do all that in a secure private way then you're going to have a re-rating of the stock and if they don't we're probably going to be sitting more or less where we're at
Horace
year from now so let me let me pick up pick up and run on this for a bit because historically apple was very much in the 20 p ratio even dipping into the teens at one point now admittedly it was growing like crazy it was very hard similar to the situation we have now with very high growth on some of the hyper scalers with without a high p e ratio so the mathematics is not favorable always like that. Just people expect that speed of growth not to continue. But here's the thing. What happened to move Apple from the 20s to the 30s and what it is, I think, was services. I was just watching during the whole Apple 50 celebrations. There were a lot of videos coming or I was re-watching or seeing old videos of executives talk about the old times and i was watching just recently Avie Tevanian he did macOS back in the day he came with next step and um and he was saying how they were a head-driven business this was taken for granted and i remember steve tops talking about how yeah we're a head-driven business we're just like babe ruth though we we can always hit that home run and the street hated that the street will never put a premium on a head-driven business because i used to summarize it as the the the goose that lays the golden eggs you're just not sure there's another one coming it's naturally it's almost human nature it's an observable pathology to kill the goose and and so what what Tim did when Tim doesn't get enough credit for this is he moved the business at least part of it to a very reliable consistent nonce non not only non-seasonal but non-cyclical business it was just like smooth smooth line these services and and then they kept pounding the table on number of subs on the number of active users which are the feed into services primarily nobody else cares really about those numbers if you're in a hardware business so the point is that it was about services smoothing out a lot of a lot of seasonality but also if you looked at it individually and you saw the margin holy cow 73 74 percent this is this is a this is a a printing press for money so people then began to internalize it but i will say this it took forever it i was saying this it was obvious to me within a few years but it took probably eight years before it got priced in and so So the conversation moved from Apple's going to have a bad or good quarter with respect to products. And now it's all it's much more about services. And people if services is a bad quarter, I think you see it much more in the stock than if you have a bad product quarter. And so my point about AI is this. Sorry for being so long winded. But my point about AI, let's assume everything works. What I think we'll end up with is Apple distributing AI. They'll be doing it as they do apps. They'll be taking a cut. They might have one favorite, but they'll allow others. We're already seeing evidence of this. So they want to be a little bit of a platform for AI. And everybody knows platforms are great. And then they'll start to show revenue growth due to AI. This is the main thing as people begin to subscribe to it. And it'll be small. It'll grow, but it'll be small. So I think the street is not going to price that in for quite some time. But once it finally clicks, this is like, again, it's even better than search for Apple, which is like, again, like a cash money coming in from Google without any cost going out. So if it works together, now everybody's going to want, of course. Let me ask you this, Horace.
Gene
Do you think that what you just described makes sense? The products slowly gain momentum and just keep gaining momentum there. How do you think the stock reacts to, do you think investors need to see, like, okay, we see the sizzle, we see that we love these products, that Apple can do AI right, but we still want to see the revenue. Show me the money. Do you think it's going to be a show me the money story, or do you think it's going to be you showed me you're competent, therefore the multiple goes up?
Horace
I think Apple tends to be much more, investors demand a lot more proof of sustainable growth.
Gene
Investors want that.
Horace
Yeah, I think it's one of those companies that there's a lot less, there's a lot less hyperbole and enthusiasm for undelivered things. But I would, again, I think there's an inclination now when the hype is still fairly strong in AI to see signals that Apple is doing these, let's say, platform decisions. And you are seeing, oh, wow, they're going to actually open it up. That, whoa, the light comes on and say, well, it's about distribution. And then people will start to give it a little bit more of a premium. But it'll be a much more, that's still anticipatory. I think we'll still be waiting for, hey, look, by the way, if you follow services, you'll see their moments in its history when it sort of kinks upwards. And one of those moments, we don't see it when it's happening. We see it only in retrospectively. And that would have been when people went from, or developers mainly switched from pay $1 for an app to pay for a subscription for an app. And when apps went to subscribe mode, the services began to accelerate even more. And so that's when Apple began also to report numbers every quarter, say we have X million or tens or hundreds of millions of subscriptions we manage. And then I think they're going to put in the report a few years from now, how many AI subscriptions they're managing. Okay. And then everybody will be able to say, oh, wait a minute, that's 20% of everything. And so if that happens, there'll still be a lot of naysayers who'll say, yeah, but everybody's going to actually pull their AI out of Apple. And they'll go play in their own sandbox. They'll make their own devices. They'll do all kinds of things. And there'll be a lot of this fear and panic has happened with Android. It's like, yeah, Apple does a great job, but somebody else is going to do good enough.
Gene
Let me ask you this in the few minutes we have left. Let's fast forward to early June and WWDC wraps up. What do you think Apple investors' heads are going to be at?
Horace
Again, I think that there'll be people who'll be super excited, but there'll be a lot of people who are also very cynical. Historically, every great product Apple's ever launched has been met with a wall of cynicism. This is a good time when we go to Apple 50 just to go back and listen to some of these old timers talk about things and how much criticism they faced and how much they had to ignore. Even the iPhone, the most important product, it was panned by most reviewers when it came out. The iPad was a joke. Every Mac was always criticized.
Gene
But the stock went up in anticipation of the iPhone. The stock went up that first weekend that the iPhone came out. AT&T missed the numbers. The whisper number was like 300,000, 400,000. And they came in at like 280,000 activations. And I remember talking to an investor and saying, iPhone did on arrival. That wasn't me talking. That was the investor talking as an analyst. And I think the point of that is like the market does jump forward and say, no.
Horace
Yeah, but I agree. The answer is probably somewhere in between.
Gene
They want to know that there's something exciting around the corner.
Horace
There's a lot of excitement. So I'm sure in January, remember it demoed in January and then it launched in June. So there was a lot of time in between for people to get really amped up about it. But there was, again, a lot of cynicism, too.
Gene
So it's hard to know.
Horace
I mean, did the stock even go up in January because of the iPhone launch? Could you imagine retrospectively buying stock in January 2007? Probably the best time to buy iPhone. I cannot say what the stock does, but I would say that already Apple has signaled that they will be a platform for AI. They've signaled that they're going to deploy hardware that's going to make AI amazing on the local device. And that they're prioritizing that roadmap with probable intent. And some people are picking this up of saying that we're going to run private AI, which probably means personal AI, might become synonymous. And that's the AI you're going to trust. You don't want to upload your medical history to a cloud AI. You don't want to upload your legal document. People have already lost cases because when you upload your legal documents, it's essentially public domain. You have to do a lot of stuff we have as private as you want to stay private. And so all of that processing, so what device do you trust? What system? What network? Everything Apple's doing is privacy-led. So I think once that trickles in, it may not be the best, but it'll be the most trusted. And that's really what a consumer would care about.
Gene
It's a huge advantage that they have. No one else can touch that. they are the gold standard when it comes to trust. And in AI first world, trust is going to come at a
Farshad
premium. So there is a question that has come up a few times, Horace. And I also have this question about what's the story with ads for Apple? And especially in the news app, which seems to be having these repeating and annoying ads. How does this balance the consumer first approach? how much money are these ads in the news app are making that that they're worth having or is there
Horace
some other i'm actually i think it's an interesting decision i don't know if it's been influenced by the publishers looking for um some some revenue because i think that the deal probably that Apple struck with publishers is very harsh. It usually is. That, look, you get exposure to millions of, billions of people. You're going to drive subscriptions. You're going to drive brand value and all these things. And so we're not going to pay very much to be an Apple News or Apple News Plus or Apple One. And I think that maybe to feel better about participation, they sort of gave them the option of ads. You know, I'm not a fan of it.
Farshad
But the ads aren't for other publishers. The ads are for some random thing. I guess maybe because I've turned on...
Horace
I don't know how they split the revenue for these ads, whether it's the company or the platform. But I'll say publishers are very comfortable with ads. That's been their core for, well, forever. So subscription plus ads is a natural business model. So as far as Apple News is concerned, I don't think there's anything there that is, let's say, There's this terrible word and enshitification, sort of making things worse. I think it's kind of making things roughly the same as the people are used to. Maybe it's a little bit better because there's not as many ads as you would get on the web. I know the experience in Apple News for me, even with ads, is superior to what I'm getting on websites. But the other thing to think about is that there's other ads, businesses that Apple runs. I mean, there's ads inside of apps. There's ads inside of, well, there's advertising that Google does, which that income from Google tech is booked as advertising revenue, I think, by Apple. So it's become substantial. They don't break it out, but they always talk about it growing. So I think they've tried to be honest and saying we are in the ad business now. We are joined at the hip of Google and therefore since they're in the ad business, we're in the ad business. It's more, let's say, honest that way. Is it a betrayal? That is the question. Is it a betrayal of the user? I think that a lot of it is trying to stay within guide rails, trying to stay reasonable. Would life be better without ads? There's also an argument there, because in many cases, people do use advertising as a way to discover things. For the first time in life, by the way, I'll give you one example. I think I probably have seen over a billion ads on YouTube. I've actually clicked on one. So I'm that's my benefit. your rate, your one in a million probably is valuable.
Farshad
Yeah. Well, I think like the job to be done on a Maps app with ads seems to me different than news. I mean, I can easily see if done properly, ads in Maps adding value to a Maps app.
Horace
That was the controversy. I cannot count the number of times that people have told me how much better Google Maps is than, than, than Apple Maps. But if Apple Maps does something to put something in there, they're all the, the, the feedback is that, Oh my God, they're ruining maps. Um, there's, there's, there's some value again in discovery. Um, but I think the way it's being positioned is like, well, it's a benefit for small businesses. And if, if small businesses use Apple Maps, they're also maybe bundling that opportunity with devices and Macs and other products Apple will sell to them. So it's part of this sweetener. I don't think it hurts that much the user as they're used to it. And I don't think people are defecting from Google Maps because there's ads in Maps.
Farshad
Also, if there is an ad sales, That means there's a relationship being built with all these companies, right?
Horace
And then that could be used for a channel. I'm not defending the idea. I'm just saying I'm not sure that as the headline ran, this is the biggest risk Apple has ever taken. I think it's kind of, it doesn't strike me as particularly strategic.
Farshad
Okay. All right. Well, that was a question that had come up a few times. We got a question. Will Apple ever move into transportation further than CarPlay Ultra? Which you have to describe to me what CarPlay Ultra is. So maybe this is a yes.
Horace
CarPlay has moved through a couple of generations in all the decades. And I'm exaggerating only slightly that it's been available. And the latest that they've been trying to sell now for quite many years is that the entire control surfaces or display surfaces of the car are going to run Apple software. And so your instruments, your entertainment, your information systems, whatever it is you're running on your car are going to be front. The front will be Apple. and that requires customization. It requires branding. And hardly anybody has signed up, even though it's been years and years. And as always, anything to do with the auto industry is absolute garbage. It's the worst industry to be associated with. I've been trying to break this business for such a long time because it's just chronically, chronically destructive. It is so bad. I don't mean environmentally. It doesn't matter if it's electric or not. It's just a really lousy business. It's lousy because of the duration of development time. It's lousy because of the lack of innovation. It's lousy because of regulation. It's lousy because of cost structures with vehicles becoming bigger and heavier and more expensive all the time. It is just stupid business. And I think Apple finally decided not to be a part of it with trying to make a vehicle. And by the way, it's just going to run off a cliff. It's just there's no escape. The auto industry is just it's propped up to the extent it exists. It's propped up by various other things that prohibit alternatives. It's like all the rules and regulations, essentially, say you shall not build, you shall not move any other way. And therefore, you're kind of stuck with it. It's a business prison.
Farshad
But anyway, I'm showing a little bit too much of my bias here.
Horace
But I think if you beat your head against that wall enough, you start to lose any hope at all. As much as I'd like to see car play, I do not own a car with it. As I said, maybe after 30 years, maybe I will. But I buy these cars, and even the newest one I have is more than 10 years old. And it just so happens that it doesn't have CarPlay. I wish it did. I might need to hack it somehow.
Farshad
Yeah, they have aftermarket products for it now.
Horace
Yeah, but they make it difficult because the display units typically are not... Yeah. You should mess with them.
Farshad
Yeah. So there's a couple of questions about AI. People are running AI on Apple devices. And how does this affect NVIDIA? I mean, there's some specific questions about APIs and such. I don't know if you are into that. I mean, I think that I see NVIDIA being attacked by Apple and Google. Yeah.
Horace
The thing is this. There's orders of magnitude differences here. The number of devices or processors, if I'm just being simplistic, that Nvidia makes is counted in the millions maybe 10 millions and each one costs thousands of dollars and so that's one where the the big numbers come from but servers are not counted in hundreds of millions um but when apple makes a phone they're going to make hundreds of millions of them. And now the roadmap for the A series and the M series already, because they probably made the decision two years ago, is going to be more and more towards this AI that we need. Let's say that is necessary for private AI. And don't forget that they started many, many years ago on having neural network support for other forms of AI. We didn't call it machine language, or sorry, machine learning. And now it's called something else is GNI. But underneath it all, it's just matrix multiplication. It's linear algebra. This is stuff. The math is not that exciting. And people talking about this being some kind of revolutionary technology, they're just scaled up circuits that are very simple and yeah there's a lot of interconnect there's a lot of optimizations there's a lot of things you can do um but the the the roadmap for apple i think is going to be like whatever you see Nvidia do today is going to be on your watch it's it's going to take many years but there's nothing in history in the history of computing we used to have machines i remember when i was in school in the 80s we had the crate the crate company made them made the fastest computers in the world they were on such a level they were the only ones that could be called supercomputers and it was made with such a technical sophistication they were liquid cooled they were immersed in their own liquid not water it was some non-conductive liquid because it ran so hot it couldn't be cooled with air they worked on making the wires a certain length so that the speed of light or the speed of electricity and they didn't use microprocessors they used their own processor architecture so you didn't have a language that you could use maybe except for fortran but they were used yeah things like weather simulations and nuclear bomb simulations and and everybody said like a cray supercomputer and nothing else it was like an ocean between them and everyone else when the iPhone shipped it was that processor was more powerful than the cray one that was the cray numbers by the way so you just have to wait 25 years or so and the most powerful computer in the world which costs hundreds of millions in today's dollars, which only the government could afford to test nuclear missiles or bombs, that became something that now we can put inside our watches. I know it's maybe an exaggeration. I'm just old enough to remember a lot of the hyperbole around hardware. And the hardware was impressive, but it didn't last. And that's the thing about hardware. And I don't, whether it's memory technologies or disk drives or even display technologies, it tends to commoditize. So it gets cheaper and then somebody else makes a better version and then sells it much cheaper, which is one of the reasons why possibly investors are starting to get nervous on NVIDIA because you just, that this doesn't last. The only exception was Intel, and Intel was because they were so tightly coupled with Windows, which was an 80% gross margin business. And since Windows only ran on Intel, Intel had to get that concession until somebody like AMD and others began to clone and essentially create a copy of an Intel processor. and got into several niches, but it was still Intel carried for 30 years the margins because of its lock-in with Microsoft. And only when ARM took over mobile did Intel finally become irrelevant. So that's a rare situation. And I think the bet on NVIDIA might be that they have this magic sauce that is going to lock people into their architecture and nobody can do matrix multiplication unless you use NVIDIA.
Farshad
It seems to me these two things are not consistent. One is that, oh, the AI is moving so fast. Everybody has to change. It's changing every moment. And then on the other side, you got to get all this hardware that I don't know what the cycle is for replacing it. So it seems like if AI is changing, then we would want the hardware to change with it. So why are people investing so much in existing hardware infrastructure? I think this is a paradox too.
Horace
I don't know if you ran yet the piece I wrote about AI and infrastructures, but stay tuned to the blog if you haven't seen it yet. But historically, infrastructures are very difficult things to monetize, even though everybody rushes in in a gold rush mentality. So whether you talk about canals, railroads, telegraph, telephone, cable network, cable TV, all of these networks were built. And investors absolutely just like love the idea, pour huge amount of money into every generation of cellular networks. And it never pays off as well as you expect. Sometimes you never get your money back. Many times these infrastructure booms lead to busts. And I asked the question, is AI an infrastructure? And right now, most people think it's somehow a vertical stack. It's the server, it's the network, it's the device, it's the software, it's the UI, it's everything. But these things tend to first of all modularize. There's no reason why you can't build a front end. And that's one of the theses of Apple and AI. It's the front end to AI. And those people who are good at servers are not good at devices and many other pieces in between. And then regulators come into the picture and they start to break it up. I mean, movie industry is a network. You have movie making and then movie distribution. The government came and broke it up.
Farshad
All right. Well, I think, yes, we have one last question about the private cloud compute. You know, again, maybe this is more of a Ben Bajarin type question, but they've been investing and telling developers, Apple has been telling developers about this private cloud compute. And obviously there's that interest in privacy and making sure things are running on a platform that they can vouch for but any thoughts about what could be the future i have not the right to guide
Horace
but as you said but here's my my impression is like because cloud implies out of your control as a user that it is cloud is something in the in in the um it's not on your device it's not password this is a whole question about whether what's in the cloud is is is public what's what's on your device is private what they wanted to use as a as a branding is like private cloud is combining or stretching the privacy protection to the cloud, and they would do so through encryption. Of course, by the way, iCloud is a private cloud, or iMessage is a private cloud. In that sense, it's encrypted communication, and not even Apple has the key. So the idea here is to extend that to heavy compute, which includes AI, and then use the little Apple logo with a lock on it and say it's secure. You can trust it, even though it might run not even on an Apple server. We don't know right now whether iCloud, as it is today, is running on some Amazon server. I suppose it could be. It's probably running on some Apple server and on some Microsoft server and on Azure, I mean, or Amazon, AWS. So there's probably a way that they've implemented iCloud so that it is distributed amongst many providers. And there's no reason why I don't think, I don't think that the logic of AI compute needs to be on Apple only. Well, right. Here's the thing. People see this and then say, oh, my God, Apple's giving away all this data. Not if it's encrypted, not if it's protected. There's nothing but unidentifiable data.
Farshad
Well, I think they're running it on their own private cloud precisely because they don't want to.
Horace
Well, it's certifying whatever hardware is in use, whatever communications is in use.
Farshad
certified in the band. I guess this week there was this news that some anthropic engineer vibe coded and released all of anthropic source code or large parts of the source code.
Horace
I think that was in April 4th.
Farshad
Was it?
Horace
Nobody noticed that they actually disclaimed it, but that's how it goes. But it could be. There's so much that's wrong with using any of these cloud services for anything private. It's you're teaching it every time you give it information, it learns. And so there's for me, there's a there's a you know, you should hire a private agent that learns about you, of course, and the world. but it shouldn't share you to the world. And that's the thin red line. And I think that we're not there yet. A lot, again, let me just do a little retrospective again with the Apple 50. It's like people remembering about the fact that this was actually, again, Avi saying this. He said he was trying to convince Steve that the Mac, when we moved to OS X, that there should be a username login. Now, this was a Unix operating system.
Farshad
Yep.
Horace
And every Unix machine is multi-user. So you can log in as you can create users, an infinite number of users, and they all can actually log in at the same time, switch between users. You remote access and so on. So I was used to that, of course, personal computer having a user name and password made sense, but Steve was against it. Steve said, no, no, you should be just go to your computer, turn it on, and it's your computer. It shouldn't put any obstacles. And Navi just couldn't convince him because he didn't have the same language and ability to, like, go over this huge obstacle, huge user satisfaction condition requirement. But just at the end, he just said, trust me, I really feel it in my bones. And somehow Steve accepted his purely intuitive answer. And later, years later, it turned out all the viruses began to attack Windows machines. And Windows didn't have user protection in the kernel. But by default, Apple did. So if an app wanted to install itself on a Mac, you have to use a name and password. So they put that protection right there automatically. It was always available. So security was built into the architecture. And as a result, the Mac withstood a decade of Windows being seen as an insecure platform while the Mac just sailed blissfully on. And few people realize the cause of that was very profound, but it was technology that was Unix, which again came from a multi-user environment. But today, if you fast forward and say, well, Apple's pounding the table on protecting your data and protecting your privacy in an age of AI, and nobody cares. Nobody thinks it's important. Nobody cared in 1990s about viruses or spam or things that were theoretically an issue. Okay, people wanted to have functioning computers that didn't crash. So now today we want functional AI that doesn't make up too much stuff, that doesn't hallucinate too much. So how far up the stack is privacy? And so wait a little while, and then you'll see how the horrors will emerge of the abuses of AI and how people's lives will be ruined, how maybe lives will be lost. And then there's this alternative out there that somehow blissfully sails on.
Farshad
Yeah. Alright then. Maybe it's a good time to wrap. Thank you, everybody. Bye-bye.
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