Apple's earnings call will reveal its AI monetization path
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At its latest earnings call, Apple disclosed its revenue approach for its AI business: rather than relying on large-scale self-built infrastructure, it will monetize through device sales, commissions, and subscriptions. CFO Parekh said AI has "multiple ways" to contribute to revenue growth over time. Ternus, who oversees hardware engineering, said features that rely on server-side models, including Siri AI and intelligent photo editing, will have usage limits; users who need more quota "will be able to purchase expanded access in the future." Siri AI has only just begun reaching users: a beta was launched for U.S. English users in September and expanded in October to French, Japanese, Korean, Portuguese, and Spanish. This strategy contrasts with Apple's low capital expenditure: last quarter's capex was only $220 million, far below Amazon's $77.3 billion and Alphabet's $51.4 billion.
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- The Verge · AIApple is all in on AI — its own and everyone else’s
Apple reported its best-ever fiscal year for revenue and earnings per share, with September-quarter iPhone revenue up 17.5% to $57.6 billion and Mac revenue up 24% to $10.8 billion, though shares fell in premarket trading after it warned rising memory costs would squeeze holiday-quarter margins. CFO Kevan Parekh said AI offers a compelling reason for customers to upgrade and switch, and Apple positions itself as the interface for AI including competitors' technology across its more than 2.5 billion active devices, spending $2.2 billion on capital expenditures last quarter versus Amazon's $77.3 billion and Alphabet's $51.4 billion. Apple plans to charge for expanded access to server-side features like Siri AI and intelligent photo editing, and benefits when customers buy Macs to run AI locally, as Gap does with Mac Mini for loss prevention and Christie's with Mac Studio for pricing estimates.
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