>>> WELCOME BACK. FRIDAY HERE ON "OVERTIME", I WALKED YOU THROUGH SOME THINGS SUPER CYCLES HAVE HAD IN COMMON TO HANDICAP WHETHER WE'LL GET ONE THIS TIME OR NOT. THERE ARE THREE CATEGORIES. NEW NETWORK AND AI CAPE TBLTS LIKE WITH THE iPHONE 4S FACETIME AND GEOGRAPHIC EXPANSION LIKE WHEN THE CHINA ROLLOUT ACCELERATED, AND IMPROVED SCREEN AND CAMERA FEATURES WITH THE iPHONE 6, 10 AND 12. LET'S LOOK AT HOW THE 16 SCORES. NETWORK AND AI, YES, PHOTOS, STORIES, AI VIDEO, MOMENTS SEARCHED WE SAW THERE, THERE'S EVEN AI TO CREATE VIDEO OUT OF THE PHOTOS AND VIDEOS IN YOUR LIBRARY. AND SIRI IS ENHANCED NOW WITH GENERATIVE AI. WHAT ABOUT GLOBAL EXPANSION? NO. APPLE INTELLIGENCE FOR NON-ENGLISH LANGUAGES A LOT OF THEM COMING NEXT YEAR, PARTICULARLY INDIA AND CHINA ARE IMPORTANT BECAUSE THEY HAVE HUGE POPULATIONS. AND THE SATELLITE COMMUNICATIONS FEATURES AREN'T GOING TO BE AVAILABLE IN CHINA AND INDIA INITIALLY. HOW ABOUT SCREEN AND CAMERA? YES, YOU HAVE THIS NEW BUTTON FOR CAMERA CONTROL. YOU CAN SEARCH FOR TAKING A PICTURE OF A DOG AND IT WILL TELL YOU WHAT KIND OF DOG IT IS. ALSO THE CAMERA ITSELF HAS BEEN IMPROVED WITH MACROCAPABILITIES BEING ABLE TO GET CLOSE. AND THERE'S A BIGGER BATTERY ON THE PHONE OVERALL. LARGER DISPLAY AS WELL ON THE PRO MODEL, SLIGHTLY LARGER, BUT STILL LARGER IN THIS REDESIGN. 2 OUT OF 3. HOW DOES THAT FAIR? LET'S TALK MORE ABOUT IT WITH OUR NEXT GUEST JOINING US NOW IS BEN BAHRON. YOU'RE AT THE EVENT. WE LOOKED THROUGH WHEN WE HAD SUPERCYCLES IN THE PAST. WE'RE NOT GOING TO HIT IT IN 2024. DOES IT LOOK POSSIBLE EVEN LIKELY IN 2025? >> I THINK YOU HIT ON ALL THE RIGHT POINTS. THE DYNAMICS THAT LED TO THE LAST SUPERCYCLE, WHICH INCLUDED A GOOD PORTION OF UPGRADES BEING PULLED FORWARD. IT'S REALLY JUST A FPHENOMENON HAVE A HARD TIME BELIEVING WE'RE GOING TO SEE AGAIN. THE ONE REALITY IS THEY HAVE A VERY AGEING INSTALLED BASE. THE BIG QUESTION THE LAST FEW YEARS HAS BEEN WHEN IS A GOOD PORTION OF BASE THAT'S ON FOUR AND FIVE-YEAR-OLD JOINS GOING TO UPGRADE WHEN THEY HAVEN'T FELT THE NEED. AND I THINK THAT WITHIN THE iPHONE 16 LINE, THEY HAVE OFFERED ENOUGH VALUE THAT I THINK THAT'S GOING TO CONVINCE A LOT OF CONSUMERS. IN YEARS PAST, WE NOTICED A SHIFT TOWARDS iPHONE PRO THAN THE BASE LEVEL. I THINK THAT MIGHT REBALANCE AGAIN THIS YEAR JUST BECAUSE OF ALL THE FEATURES AND TECHNOLOGY THAT'S PACKED INTO iPHONE 16 AND AGGRESSIVE CARRIER UPDATES. I THINK WE'LL SEE A STRONG CYCLE TO UPGRADE. PARTICULARLY, THAT'S GOING TO BENEFIT THE iPHONE 16. >> PART OF THE STORY OF THE LAST FOUR YEARS FOR THE iPHONE LINE HAS BEEN THE BROADENING OF IT. PEOPLE WERE SHOCKED WHEN THE iPHONE 10 COST $1,000. WITH US THEY ACTUALLY MANAGED TO BUILD ON THE PRO AND PRO MAX MODELS GOING ABOVE THAT. THEN THE iPHONE SE, THEY TURNED THAT INTO A VIABLE, THOUGH UNDERPOWERED, BUT VIABLE 450 ROUGHLY OFFERING AT THE LOWER END. HOW MUCH DEPENDS IN THIS SUPERCYCLE ON HOW MUCH THEY ARE ABLE TO SHIFT THAT REVENUE MORE TOWARDS THE HIGHER END OF THE LINE? THEY DON'T GIVE US A BREAK DOWN ON UNITS VERSUS REVENUE. IT'S HARDER THAN IT USED TO BE IN THE PAST. >> I THINK, OBVIOUSLY, ANALYSTS WILL DO THEIR BREAKDOWN. IF YOU FOLLOW MY LOGIC THAT YOU MIGHT SEE A STRONGER, WE'LL HAVE AN ASP DYNAMIC. WHERE IT'S SKEWED TOWARDS THE PRO. BUT I THINK YOU'RE RIGHT. A GOOD PORTION OF US SORT OF SEEING IF A SUPERCYCLE PLAYS OUT, IS A GOOD PORTION OF THE UPGRADES BEING PULLED FORWARD. UPGRADES WILL HAPPEN IN TIME. I THINK THIS MAKES A VERY ATTRACTIVE OFFERING FOR THAT VERY BASE THEY ARE SEEING. I THINK THIS IS THE STRONGEST BASE LEVEL iPHONE 16 THAT THEY HAVE LAUNCHED IN SOME TIME. I THINK THAT WILL HELP. I DON'T THINK WE'RE GOING TO SEE A DRASTIC PULLING FORWARD OF UPGRADES BASED ON THE HARDWARE. WE HAVE AN AGEING BASE. A PORTION OF THAT IS GOING TO FALL INTO THE NEXT SIX MONTHS. >> DO YOU THINK THERE'S ANY PARTICULAR ADVANTAGE TO CARRIERS IN SUBSIDIZING THE AI-ENABLED VERSION OF THIS PHONE? IT'S NOT LIKE IT'S A NETWORK UPGRADE THAT YOU'RE SUPPORTING. DOES IT MATTER IN THE CALCULOUS? >> I THINK IT DOES JUST FROM A CONTRACTUAL STANDPOINT. THERE'S ABILITIES TO LOCK IN MORE OF YOUR CUSTOMERS, EVEN IF YOU DO THAT UPGRADE. YOU'RE STILL AGREEING TO STAY WITH THAT CARRIER FOR A LONG PERIOD OF TIME. THERE MIGHT BE OTHER PRICING DYNAMICS. . THEY MIGHT SAY HERE'S AN AM WATCH. HERE'S CONNECTIVITY FOR THAT DEVICE. THEY ARE OFFERING MORE DEVICES PER PERSON. THEY ARE USING THAT TO BROADEN THEIR ECOSYSTEM AND PULL THEM IN. BUT THEY WANT LOYALTY. THEY WANT CUSTOMERS COMING AND STAYING ON THEIR NETWORK. THERE ARE ECONOMIC ADVANTAGES OVER TIME REGARDLESS OF MODEL. I'M NOT SURE THAT THE AI FEATURES DO ANYTHING TO DRIVE MORE DA TARKS BUT IT JUST CUSTOMER LOYALTY