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

Apple exceeded expectations then announced its quarterly results On Thursday, it emerged that the company earned $143.8 billion in revenue, up 16% year over year. As analysts bombarded CEO Tim Cook with softball questions during Apple’s earnings call, one analyst dared to ask the question that seemingly no one in Silicon Valley is willing to ask.

“When I think about your AI initiatives, it’s clear that there are additional costs involved… Many of your competitors have already integrated AI into their devices, and it’s just not yet clear what incremental revenue they’re seeing from AI…,” began Morgan Stanley’s Erik Woodring.

Could there be a hint of nervousness beneath this financial man’s probably very financial facade? I can only imagine that it must have been a Herculean display of courage. Woodring asked the question that only lurks in the darkest, dampest recesses of investors’ minds.

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

You would think this would come up more often. You’d be wrong. Instead, Big Tech has taken a largely vibe-based approach to AI development. Take OpenAI for example, which seems like it’s on top of the world given the way ChatGPT has embedded itself into the cultural consciousness. But the company has no intention of making money to 2030. HBSC analysts even doubt that timeline, especially since estimates indicate an additional $207 billion in financing will be needed. Ask anyone in tech how OpenAI plans to break even, and you’ll encounter the verbal equivalent of the ¯\_(ツ)_/¯ emoticon.

But good old Tim “$143.8 billion in revenue” Cook had a good afternoon, so maybe he would finally talk about how these companies plan to recoup their investments.

His answer was disappointing.

“Let me say that we’re bringing intelligence to more of the things that people love, and we’re integrating it across the operating system in a personal and private way. I think that creates great value, and that opens up a whole range of possibilities for our products and services,” Cook said.

So there you have it, folks. Apple will monetize AI by creating “big value.” And, crucially, that will ‘open up a range of possibilities’. We will experience this in ‘products and services’. Cool!

Well, shout out to that Morgan Stanley guy for trying.