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Top stories today:
- Apple's revenue only +2% YoY to $119.6B in Q4
- Amazon's revenue +14% to $170B, with operating income +4.8x
- Meta's revenue +25% to $40.1B, as Reality Labs continue losses
- Google ImageFX, text-to-image AI model, released to public
- Google Maps gets generative AI features
0. Data and calendar
All values as of 6 AM ET / 3 AM PT, other than S&P500 and NASDAQ close (4 PM ET / 1 PM PT).
All times are ET.
1. Apple's revenue +2% YoY to $119.6B in Q4, as Europe, iPhone, Services lead growth
Net income was +13% to $33.9B, with net margin expanding to 28%:
Guidance for Q1 was ~0%, disappointing markets (stock -3% after hours).
New AI products are going to be shared ālater this year.ā
Apple will not license Masimo's patents related to the Watch's blood oxygen detection, focused on appeals and new designs.
Revenue growth was small at 2%, coming after 4 quarters of negative growth
Greater China and the iPad saw large drops in sales
In 2023, the iPhone represented 50% of global smartphone sales, with its average selling price reaching $890
Our view: Apple's current products have been plateauing in revenue, so what's next for growth?
Some potential ideas:
iPhone growing in new emerging markets such as India and Africa.
Vision Pro outperforming its low sales targets (500K units in 2024).
This often happens organically: A few enthusiasts within an organization will turn to public-facing AI services to find ways to increase their own productivity, then bring those insights to their employer.
Data supports this ā a recent study from Deloitte found that off-the-shelf tools are the primary way businesses are deploying AI, and a survey from The Conference Board shows employees often begin using AI tools even before their company has an official AI policy.
MindStudio is a tool that enables anyone to start building AI apps in a single afternoon. Connect AIs cross-departmentally, use any models, and integrate current tech stack without using any code.
*Sponsored.
3. Amazon's revenue +14% to $170B, with operating income +4.8x to $13.2B
Operating income growth was led by North America, which is finally seeing profits after 30 years of ~0% margins
Bezos's long-term vision is paying off:
Read more: CNBC.
Amazon also announced Rufus, its AI chatbot for mobile
Read more: Techcrunch.
4. Meta's revenue +25% to $40.1B, as operational efficiency masked Reality Labsās continued losses
Revenue growth was spread across all regions:
Family of Apps had a record operating income of $21.0B, while Reality Labs had a record -$4.6B result
Zuckerberg said Apple's new rules were āso onerousā that no developer would adopt them.
Threads at 130M MAUs, vs. 100M in Q3. DAUs or minutes per day were not disclosed.
$0.50 dividend initiated, $50B share buyback authorized.
$700M in dividends/year for Zuckerberg's 13% stake.
5. Google ImageFX, text-to-image AI model, released to public
It appears to be of similar quality to OpenAI's DALL-E 3, but we await formal tests:
Google ImageFX vs ChatGPT 4, which uses DALL-E 3.
