“Tim Cook, Apple’s CEO, normally goes through the quarterly earnings call without skipping a beat. Nearly every time he speaks, Cook reminds everyone ‘This is Tim’ and then gives a polished answer to whatever question he’s answering,” Mark Rogowsky writes for Forbes. “Yesterday, though, something different happened and it wasn’t just the dropping of the self introduction. Apple had just delivered a quarter that narrowly exceeded expectations — even though the company reported its first annual revenue decline since 2001.”
“Cook reeled off some highlights: Apple saw a record number of switchers from Android to iPhone, the company’s services business grew 24% to $6.3 billion, Apple Music has industry leading customer satisfaction in streaming. Then, as always, the question-and-answer segment followed and one moment seemed to set Cook off,” Rogowsky writes. “Steve Milunovich, currently at UBS but a Wall Street analyst for decades, asked: “The question is … does Apple today have a grand strategy for what you want to do? I know you won’t tell us what it us, but do you know what you want to do over the next three to maybe five years?””
“Cook replied more politely than many might have. ‘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 ahead,’ he said,” Rogowsky writes. “Milunovich tried to follow up and Cook essentially blew him off with a one-sentence reply. I can’t be in Cook’s head. But given that Apple is typically working 2-3 generations ahead on iPhone, Apple Watch, et al. and has been upping R&D spending by billions of dollars, it’s likely he was churning through less generous replies. The idea that Apple doesn’t have a 3-5 year plan is so beyond absurd it is a bit odd that a veteran analyst would pose that question. That the very asking implies Apple is rudderless suggests a captain lost at sea.”
Read more in the full article here.
MacDailyNews Take: It was a foolish, impertinent question. We don’t know if Milunovich meant it the way it came across, but the fact that he asked it twice suggests either tone-deafness or intended disrespect.
On our very best behavior, we’d have answered: “No, Steven, the CEO of the world’s most valuable company has no plan. Next question.” Likely, our reply would be much worse. Milunovich wouldn’t be thanking us for the additional color, that’s for sure.
Cook showed remarkable restraint. Steve Jobs would have absolutely eviscerated Milunovich. There’d have been no recalcitrant followup question. Of course, Milunovich would have never had the temerity to pose such an insolent question to Jobs.
Here’s the full exchange, verbatim:
Steven M. Milunovich – UBS Securities: Tim, some investors are antsy that Apple has 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 us, 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 that 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 so 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?
Tim Cook: 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 ahead.
Milunovich: But in terms of your approach I guess to new products, do you have a strong sense of where technology is going and where you’re going to play? Or is it still enough up the year that you are willing to react fairly quickly, which arguably your organization allows you to do for the size of company you are?
Cook: We have a strong sense of where things go and we’re very agile to shift as we need to.
Milunovich: Okay. Thank you.
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