Hello everyone. Welcome to a new week.

Last Friday, we went over the numbers from Apple’s 2Q23 earnings release. We also looked at two of the major themes from earnings: the impact from less device upgrading and Apple’s emerging markets strength.

In today’s update, we will focus on Apple’s earnings Q&A session with analysts. After recapping each question-and-answer exchange that occurred on the call between Apple and sell-side analysts, we will go over my thoughts / response to the exchange. Let’s go beyond what was talked about on the call.

NOTE: The following earnings call questions (“Q (Sell-Side Firm)”) and answers (“Cook” or “Luca”) have been cut, summarized, paraphrased, and rearranged for clarity. To read the full question and answer exchanges, MarkerBeat offers a written transcript here.

iPhone

Q (Morgan Stanley): Did Apple experience iPhone demand deferral or destruction arising from the COVID shutdowns in late 2022?

Cook: Our 2Q23 results reflected some iPhone demand carryover from 1Q23. iPhone production is back where we want it to be.

My response: Recall our discussion heading into earnings about two variables driving iPhone sales in 2Q23: Underlying customer demand and a sales carryover from 1Q23 related to COVID shutdowns. Cook’s answer implies that

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