Happy Friday! This will be the last AWT News Update podcast until next Friday, but we have some good news for you:
- Loup Ventures analyst Gene Munster thinks that “Apple as a Service” is the next big reason for investors to keep backing the company
- A 76-year-old Hong Kong man is the latest to have his life saved by Apple Watch
- Microsoft wants to work with Apple to get iMessages on Windows
The text version of the podcast can be read below. To listen to the podcast here, click the play button on the player below. Apple News readers need to visit Apple World Today in order to listen to the podcast.
Text Version
This is Steve Sande for Apple World Today, and you’re listening to the AWT News Update podcast for Friday, May 11th, 2018. I’ll be away from the microphone for the next four weekdays, so tune in again on Friday, May 18th for the next episode of this podcast.
You’ve probably noticed a theme in our coverage of Wall Street analysts — we like to make fun of them. One of our favorite analysts over the years has been Gene Munster, who is now with Loup Ventures. While he’s been insistent in the past that Apple was going to come out with a true Apple-branded hi-definition television and seemed fixated on an Apple-branded car, he’s now somewhat more bullish on Apple and making a lot more sense than he did. Munster now thinks that the paradigm that drives investor thinking about Apple has shifted again. Originally the reason for investors to put money on Apple was to be competition to the IBM PC, then in 2001 the company entered the iPod era, in 2007 it entered the iPhone era, and now it’s moving into a services era. Munster calls this “Apple as a Service” and thinks that it will help the company get away from product cycle hype before new product releases and anxiety related to unit sales once a product ships. Munster thinks that Apple as a Service will see a lower growth rate in iPhone sales, anywhere from 0 to 5 percent annually. The Services business will continue growing at a rate of about 15 percent annually for the next few years. The third theme is capital return, with Apple purchasing back even more of its common stock, rising to as much as $40 to $50 billion per year. Finally, Apple will need to still invest in new products and services in order to maintain interest in its cash cow — the iPhone. Munster thinks that these four themes create a stable business growing at 5 to 10 percent per year, with most of its profits being returned to shareholders. That news should help Apple’s stock continue to rise.
With all of the great stories that keep coming out about people whose lives are being saved by their Apple Watches, we may need to have a daily segment devoted to that theme. The latest story is out of Hong Kong, where semi-retired diamond trader Gaston D’Aquino is crediting the Apple Watch with saving his life. D’Aquino was at Easter Sunday Mass on April 1 and left early after his watch told him he had an elevated heart rate. At the doctor’s office, he told the doctor “I don’t know why I’m here, but my watch tells me I have an elevated heart rate.” D’Aquino said he felt fine, but when the doctor hooked him up to an electrocardiograph machine, they immediately started a series of tests over the next three days and found that of the three main coronary arteries, two were completely blocked and one was 90 percent blocked. The result of the tests was shared with D’Aquino, who had angioplasty to open the clogged arteries the next morning. D’Aquino sent an email to Apple CEO Tim Cook on April 6, telling Cook “I have been given a new lease on life. Please continue promoting the use of the Apple Watch for anyone with cardiac problems. I lost a cousin two weeks ago to a massive heart attack, and if he had an Apple Watch, he might have had the same opportunity I got — to live.” Cook replied on April 7, saying “Gaston, I’m so glad you sought medical attention and you’re fine now. I appreciate you taking the time to share your story. It inspires us to keep pushing. Best, Tim.”
Finally, guess who wants to see iMessage on Windows devices? Microsoft. Two of the software company’s top Windows executives told The Verge that they want to make their operating system more compatible with non-Windows mobile platforms, those being iOS and Android. This week, Microsoft previewed the Your Phone app, which will mirror Android and iOS interfaces on Windows PCs. They’re able to do iOS photos and notifications now, and say that Apple makes it harder for messages, but they’d like to work with Apple on bringing iMessages to Windows.
That’s all the news for today – join me next Friday afternoon for the next edition of the AWT News Update.
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