Guys, I don’t think Tim Cook knows how to monetize AI

Apple exceeded expectations when it announced its quarterly earnings on Thursday, revealing that it generated $143.8 billion in revenue, an increase of 16% year over year. While analysts peppered CEO Tim Cook with trivial questions during Apple’s earnings call, one analyst dared to ask the question no one in Silicon Valley seemed willing to ask.

“When I think about your AI initiatives, you know, there are clearly incremental costs associated with that… Many of your competitors have already integrated AI into their devices, and it’s not yet clear what incremental monetization they’re seeing because of AI…” began Morgan Stanley’s Eric Woodring.

Could there be a tinge of nervousness beneath this man’s perhaps hyper-financed facade? In what I can only imagine was a tremendous display of courage, Woodring asked the question that only lurks in the darkest recesses of investors’ minds.

“So, how do you monetize AI?” he asked.

I thought this would come over. You would be wrong. Instead, big tech companies have taken a largely emotion-based approach to developing AI. Take OpenAI, for example, which may seem like it’s on top of the world, given how ChatGPT has become embedded in the cultural consciousness. But the company doesn’t plan to make any money until 2030. Even analysts from HBSC question that timeline, especially since it will need another $207 billion in financing, according to estimates. Ask anyone in technology how OpenAI plans to break even, and you’ll be met with the verbal equivalent of the symbol ¯\_(ツ)_/¯.

But Tim Tayeb “$143.8 billion revenue” Cook has been spending the afternoon, so he may finally divulge how any of these companies plan to recoup their investments.

His answer was disappointing.

“Well, let me just say that we’re bringing intelligence to more of what people love, and we’re integrating it across the operating system in a personal and private way, and I think by doing that, it creates great value, and that opens up a bunch of opportunities across our products and services,” Cook said.

So, there you have it, people. Apple will monetize AI by creating “significant value.” More importantly, this would “open up a range of opportunities.” This is what we will test in “Products and Services”. amazing!

Well, I applaud the Morgan Stanley guy for trying.