iPhone 17 leads Apple earnings record, new MacBooks near, and a mysterious $2B acquisition

mayo yesterday you reported on the fact that you can now go to f1 tv and like link your apple tv account with your f1 tv account so when the first what are they called grand pre grand pre is that i just call them races races when the first races happen next month you're all set up to watch with your apple tv subscription there's also pre-season broadcast that happened like from next week so part of the reason it's rolled out now is if you are a dedicated fan you actually want to tune into that stuff so you could do that from next week i would like to tune in i want to become a big f1 guy this year but i've been trying for the past 18 hours to go through this linking process between f1 tv and my apple tv account and all i can see is a big i send it to you a big loading circle never stops loading so maybe it's just not meant to be with me and f1 tv yeah the response from the f1 the hardcore f1 tv subreddit is half people like it works fine i did it it was easy the other people are like i just get an error it just spins forever or like i think they're just overloaded with requests at the moment so it probably takes a while to filter out um obviously you don't have to do the linking process like the races streams will all be through the tv app anyway but if you want like the additional features the additional content that if you want the experience that you had last year where you're paying f1 tv directly then you have to do the account linking thing um the basic what most like what the vast majority of people that enjoy the sport watch will be streamed directly through the tv app itself but if you want to use the f1 tv staff which gives you like some more platform features and some extra content and things and like archives of like all the past races going back years and years and years then you need the f1 tv access and this should supposedly give you that but yeah obviously it's teething problems yeah are people have you seen are people coming around to the realization that this doesn't mean like they'll have to pay extra because this whole time since the deal was announced between apple and f1 tv it's like every day on threads the algorithm shows me something that's like i can't believe f1 is selling out now i have to pay extra like are people coming around to that finally and like realizing what's actually happening yeah slowly even on the threads it's like you can now link your account it's like so i have to pay apple a ransom to access my f1 account it's like no but people will figure it out at the end of the day it is actually cheaper or the same price as what they paid last year so i do think they could have done a slightly better job in communicating it i mean the linking process probably should have rolled out like at the start of january because you could access like archive content for the entire january and there wasn't really a way to do it before if you were if you wanted to like f1 tv cancelled all the subscriptions end of the year and then you just kind of stranded for a month so they could have done it a bit more smoothly um but but i think the complainers would die down when they realize they can literally do exactly what did last year for the same amount of money or you can watch through apple tv directly and hopefully there's a press release at some point like walking people through all of it again and showing what accommodations apple's going to make in the tv app itself for people who just want to watch there yeah i mean they should like get the how they have like a dedicated tab for mls right on the website and stuff they should have a dedicated tab for formula one come up the the apple marketing has always said for the first race weekend so that might not happen until like the start of march and then the the interim solution people that want to watch the precinct testing is the like the account linking thing yeah um so but yeah they should i mean they supposedly they they promised you know production enhancements and all that jazz so they should have some sort of press release for it sometime this month i would expect Well, I know what you're really excited about is baseball season, and I'm happy to report that we're 50 days away from the start of spring training. So make sure to get your MLB TV subscriptions in order while I work on my F1 TV subscription. Yeah, I'll get around that. Shortly after we stopped recording last week, the Financial Times and Reuters both broke a story that Apple has acquired the Israel-based AI startup called QAI. The reports say that the deal is valued at close to $2 billion, which I think makes it, at least based on public information, that makes it Apple's second largest acquisition ever, with the biggest, of course, being Beats for $3 billion in 2014. And they basically required to publicly disclose acquisitions bigger that are like meaningfully big. So if there was a bigger one, they would have said. So this is their second biggest acquisition ever. And they didn't issue a press release or anything about this. Instead, there was a quote from Johnny Surugi given to Reuters and the Financial Times where he says, QAI is a remarkable company that is pioneering new and creative ways to use imaging and machine learning. We're thrilled to acquire the company with Aviate at the helm and even more excited for what's to come. So Aviad Maisels, who Saruji is referencing there, he was one of the founders of PrimeSense, which was another company that Apple bought in 2013 for $345 million. And PrimeSense technology was for Face ID. Yes, they were like the original company behind the Microsoft Connect platform, too, like the body tracking thing for the Xbox. But yeah, Apple bought them for Face ID reasons. to great success. Yes, to great success, yeah. They sold everybody on $1,000 phones. A lot of the iPhone X appear was the face unlock. So yeah, they definitely got the return on that investment. And then I guess Avi had left the company after a few years and now he's back again with something 10 times bigger, essentially. For a startup that I hadn't heard of before, had you? I had never heard of them, no. If you try to find out what exactly QAI does, it's pretty hard. Their website just said, In a world full of noise, we craft a new kind of quiet, magic realized. Like, okay, what on earth does that mean? If you do a little digging into like patent filings, it seems like what QAI has built is machine learning technology for audio and what they call silent voice input. So systems to understand and improve communication in like noisy or difficult environments. So ways to interpret facial movements and expressions so you can communicate with AI inferences, not using your voice, but rather with just those, what they call like micro facial movements. So you can like mouth your words out and you're like lip read, I guess. I guess. Or you can like wink or stick your tongue out or something, something like that. but if you zoom out and like getting into the specifics of the technology is probably not really worth it and there's just not much to get into because we don't know but in terms of how apple could implement this stuff it's like the opportunities are really endless including implementing it into the iphone and into the front-facing camera for that type of stuff or of course broader ai focused hardware like the ai pin that we talked about a couple weeks ago smart glasses airpods with cameras like opportunities really are endless here i think even like vision pro headset yeah because input text input is a problem on vision pro i mean absolutely there was those rumors before the vision pro came out that they were working on a more fine-grained virtual keyboard input thing right do you remember that like they were yeah because they obviously what they shipped was a very like coarse big buttons thing it's like you made a lot hunt and pay one finger but there were some reports they'd kind of been developing a you could basically like touch type in midair and it would be able to figure out what keys you're meant to be hitting and type but obviously nothing's come of that so far because vision pro is like the touch input in terms of you know looking around and tapping your things together is great for navigating the ui but it's not good for typing right like if you want to do long long stream detecting something else there's a lot that if you want to do on vision pro you just need a keyboard like you need a bluetooth keyboard that you pair to your vision pro to get it done and that's not a tool not a toy right yeah text is a huge part of that world even for like just typing in domain names and things you know um and siri can only get you so far siri that's improved will do better but it's awkward to like voice out your stuff in the world especially if you're like in a room with somebody else and you just want to like you you can be conversational in a like if you're if you've got if you're on your partner in a room you're both on your phones like you you can tap away in privacy while talking to each other right you've got the headset on you want to then like input some text you've got to you know enunciate to the world this is what i'm looking at like it's it's just awkward and you know if they can do some kind of not you know mind reading is a very sci-fi way of describing it but a way of getting like high capacity high bandwidth text input without you having to use your voice uh that would be pretty valuable i also just have to assume that qai has a lot of smart people working on ai things and apple's bolstering its capacity i'm sure there's specific things they've done that appeal to them but i don't really feel like you buy a start for two billion just for like mouthing words recognition you know it must be like a bigger aqua higher kind of yeah as well i mean prime sense is a good comparison that was a you know, that's what they normally do. A few hundred million dollars here and there for these smaller companies that have technology they want. Two billion is a pretty big expenditure for them. I mean, it's the second biggest ever. And this is for a startup that has seemingly no revenue at the moment. Like when they bought Beats, I think they even said it would be revenue accretive within like three years, i.e. revenue was bringing in like a billion dollars a year in revenue under Apple. So it was pretty clear they would get return on investment. With QAI, it's a lot murkier because they don't sell any products right now. They don't even have a product on the market, right? It's all very behind closed doors. So there's got to be something pretty valuable for them to splurge on this. And it does look still kind of comical in the big tech marketplace at large. Two billion is nothing, right? They spent $20 billion on WhatsApp and $20 billion here and all this by server capacity for $50 billion. I'm pretty sure Google in their earnings report like a couple days ago said that they're going to spend like 180 billion dollar on AI server capacity over the next like three years or something insane for Apple though two billion is a big amount because they spend very little money at all I mean I said it was a big deal that they'd committed to spending a billion dollars a year to get the Gemini deal in place yeah so this is definitely up there because I remember or I was thinking right after this story broke I was like oh this is a huge story like everybody's going to talk about it, then nobody did. Apple dropped $2 billion on a company. And like you said, in today's world, that's, I guess, just such a small amount of money, which feels weird to say that it's not considered as disruptive or as dramatic as it would have been a decade ago. It's interesting that the statement in the Financial Times story is from Suruji. It's not from anybody on the AI or the ML teams. It's not from Tim Cook himself. It's not from John Ternus, which I think maybe would have made sense if they're trying to position him as one of the bigger faces of the company. It's from Suruji, who is the vice president of hardware technologies. Did you think anything of that? Or is that who you would have expected? I mean, I guess it would be him or Ternus, right? I don't know, because they don't have a... Like, in the previous arrangement, it would have been Jean-Andrea, right? Yeah. You go on the leadership page right now, there isn't an AI man or an AI woman. The AI role got subsumed underneath Federighi and it doesn't really feel like something that Federighi would announce if it was more technology side. Yeah, and it sounds like Surigi maybe had some sort of personal relationship with them or they got on well. And I guess when they were part of Apple for the Face ID stuff, I presume that was under hardware technologies at the time. so maybe they have like an ongoing relationship and that's part of the reason why I did it but yeah he's probably the best fit either him or Ternus right because I don't really like what's the overlap between hardware technologies and hardware engineering it's quite similar right in some regards so I guess it would be either of those two so it didn't like stick out I was like this is really left field but yeah it's like if Jean-Andrea was still on the page it would probably be under his masthead but he's not there anymore and how did apple pay for that two billion dollar acquisition turns out they made a lot of money in the fourth quarter of 2025 or no sorry the first quarter of 2026 because they're on the fiscal calendar yes that's holiday quarters that's last quarter 25 yeah the months of october november and december of 2025 apple reported its earnings an overall record-breaking quarter 143.7 billion in revenue, up 16% year over year. Like usual, I don't think we need to get into the exact numbers for each category. But what is interesting for iPhone, basically. Yes, what's most interesting is iPhone revenue was up 23%, an all-time record of $85.3 billion. We talked about this after the last quarterly earnings report, at which point we only had a couple weeks of iPhone 17 sales. But during the earnings call, Tim Cook was basically saying that they were caught off guard by how popular the iPhone 17 was. They didn't expect the level of demand that they got. They were struggling to keep up with balancing supply and demand. And based on comments during this earnings call, that didn't really change. He said they exited the December quarter with very lean channel inventory due to staggering levels of demand. And then he specifically said, I'll read this quote. We are currently constrained, and at this point, it's difficult to predict when supply and demand will balance. The constraints that we have are driven by the availability of the advanced nodes that our SOCs are produced on. And at this time, we're seeing less flexibility in the supply chain than normal, partly because of our increased demand that I just spoke about. I think it's rare that Apple finds themselves in these positions where they're struggling to balance supply and demand, particularly or especially for iPhones now. Putting like 2020 and the COVID year aside, they're really good at anticipating how much a new iPhone will sell and making just enough to supply that demand and still have inventory in their channels. But something about the iPhone 17 has – it's just popular. That's what it is. 23% increase in revenue. I mean, iPhone revenue for that quarter was $85 billion. The year ago holiday quarter was $69 billion. Yeah. That is a big step up for a phone that has been relatively flat in terms of sales growth for a few years now, right? Like it peaked before the latest high The previous peak was 2022 at billion and then it kind of drooped down a little bit to 65 and 69 and 69 again And then bang 85 So the iPhone 17 series has definitely resonated. And it comes to the classic thing. It's like, when do people buy new iPhones? It's when they look different. And they don't even look that different. That's what's amazing about this. Well, they've got bolder colors on the Pro phones as well. I think part of what makes them so popular is the design is different enough that it looks new. But also, the design is, like we talked about this when the phones were announced, it's kind of controversial. Like the two-toned colors, the big camera bar in the back, the orange, it's kind of controversial. But I think people like it because A, it looks different. And B, they like the fact that it doesn't look like every other smartphone. It is controversial. It is, to a degree at least, more daring than an iPhone has been in a long time. Yeah, it was a bold try. I mean, when's the last time they didn't offer a flagship iPhone? Not in black, you know? Yeah, that too. They went for it. Not to my personal liking, really, which is one of the contributing factors to why I bought the Air instead, which they didn't bring up at all on the Air. It's cool. I mean, they said it was like due to the success of the iPhone 17 lineup. I was like, do they include the iPhone in that? I don't know. But nobody asked. And I think the implication is that it does not include the Air. I think the Air is doing okay, but it's not the reason that their sales have spiked by 23%. It's the Pro phones being super popular. And they also had a big resurgence in China. Yes. If you look at China demand. And again, it's stereotypical, but China seems very driven by the fashion. When the phones look more different, they get a lot more sales. And it'd been a few years of pent-up demand where the phone kind of looked the same, right? I mean, you can go back to the iPhone 12, essentially, for the design before this Pro. And even the iPhone 12 design is like... I'd say the difference between the iPhone 11 design and the 12 design was less significant than like the 16 to the 17. No, like it's just more bold. Yeah. Because the difference between the 11 and the 12 is that they've squared off the edges. But I think you give that to like a layperson it's a lot it's a lot harder for them to note discern the difference there like obviously we can tell immediately but you give it to like someone who doesn't really care and they just you know they like an iphone i feel like the 17 pro is more of a standout in terms of it looking different than the difference between 11 and 12 and because they still had like you know the titanium edges and everything it was just kind of the shape was a bit different whereas this one's like different materials different colors a bigger bar chain you know camera bar change so this is probably the biggest change in the look of the phone since the iphone 10 i think you can quite reasonably argue and maybe that's a big reflection in in the numbers here like how much is this sustainable like clearly the iphone 18 series this fall is going to look the same right maybe they'll do some different colored options but the design of the phone is going to be the same and they also won't have we believe an iphone air refresh for this fall and the base iphone 18 is getting delayed to or not getting delayed but they're moving to a spring cycle for that as well right so they're gonna some of these peaks are going to be more flattened out uh as they move some of the phones to a different part of the year um but even if they were releasing all the phones at the same time this fall i don't think right now you'd expect them to have like i feel like the sales would be flat or go down like they're not going to have the same growth again and yeah with the 18 cycle i mean the fold is the wild card there um and i think the fold's be popular but probably not to the quantities and required to overcome or offset the difference of losing like the base phone being released at that time the fold is probably going to sell just as well as the air i would anticipate it's going to it's going to be that awkward spot that apple's always had in the lineup the difference between it and the air though is it's going to be twice the price of the iphone air at least yeah so from a revenue perspective that definitely does help apple If you look at the iPhone 17 beyond just the design and like just what I hear from people and what I see online, the camera is what really seems to be driving people to upgrade. In particular, you know, the standout feature, I think, at least in terms of like influencers and creators and stuff, it's dual capture in the camera app. Really? That is crazy popular. and it's so weird because that is probably a arbitrary hardware limitation right like there have been third party apps that can do that on older iPhones for a few years at this point but the iPhone 11 Pro keynote Apple introduced the support into the OS and got Filmic on the stage and were like they're using our new system to do a dual capsule presentation and it took them another what 11, 12 6 years to roll it into their own camera app and then limit it To just the iPhone 17. Yeah. But it's popular and that's, they had to have known that. And that's one of the reasons people are buying the iPhone 17. One of the things, by the way, on that dual capture thing is, they were so like to the party, I feel like they could have done a slight bit more with it. Like it kind of just bakes the picture in picture into the video. And that's it. Like, I kind of feel like after the fact, you should be able to like move the video again or like hide it in sequences or clips of it. Like a bit more sophisticated system then you know you get one shot to do a dual caption that's it um because like what if you want to move where the portrait where the where the thumbnail is yeah because you move it's hiding something in the video yeah yeah exactly and in the moment you can drag it around but it's the kind of thing that you'd also like to be able to change after the fact like you can change the focus point of a portrait photo for instance like it doesn't feel too computation intensive for them to record the two layers separately and then you'd be able to like edit them back together afterwards but um i mean what if you do do a dual capture and then at the end of it you're like you kind of regret and you're like i just wish i had the the main camera feed i didn't have my front perspective you're stuck even with something as simple as like cropping on photos or videos you can undo and edit and they have you know change history you can revert everything but the dual capture bakes it in so if it is that popular they should build on it and give it a bit more capability the comparison that i've seen a lot is whether like the quote-unquote super cycle that the iPhone saw with the iPhone 6 is whether the iPhone 17 is like the modern example of that. Because we had unit sales when the iPhone 6 was the new phone. Then the reason Apple stopped reporting unit sales is because they could not match the unit sales that the iPhone 6 series sold. But if you look at the numbers and revenue that we have now, like you said, compared to 24, 23, 22, this is probably the modern example of a quote unquote super cycle, I think, with the previous maybe example being the iPhone 12. I think the iPhone 17 is closer to that iPhone 6 era. Yeah, I mean, Apple's entire business got like a COVID bump, right? Yeah. This is very like isolated to the phone. Their other divisions did okay, but it was like a lot of them were flat or slightly down, right? In terms of their hardware division. Services carries on doing mid-double-digit growth every quarter. the iPhone was like far beyond what predictions expected. You know, Tim Cook called it like remarkable or whatever. Yeah, staggering. And it is a question of whether it's a, can they sustain at this level or is it going to like dip back down and we're going to revert more to the mean of, you know, $6, $9 billion, $79 billion, but like that kind of range again. But I mean, they'll definitely take it in the moment for sure. And the other categories, the Mac was down 7%. The iPad was up 6%. Services revenue was up 14%. The other interesting category, though, I think was wearables, where wearable revenue was down 2%. And when I first saw this in the numbers, I was kind of concerned or I don't know if like confused because they just launched AirPods Pro 3 in the quarter. Historically, AirPods Pro sell incredibly well. Those sales always boost the wearable category during the holiday quarter especially. But then during the call, Kevin Pareka, the CFO, he said constraints on the AirPods Pro 3 or said they were supply constrained on the AirPods Pro 3 and that they believe the overall category would have grown had it not been for those constraints. I think that makes more sense because at first my theory was maybe the fit issues of AirPods Pro 3 that some people have had are actually having an impact on sales. i'm sure they are to a degree but it sounds like supply constraints were the real the real bottleneck for that category in most reactions i do here from the airpods pro 3 are positive yeah yeah it definitely has um outlier cases and it's not like as simple as if you're an existing airpods pro owner upgrade and you'll be you'll definitely be happy right because there are some like little gotchas whether it's the sound profile or the fit or you know even some people have like the noise cancellation is stronger but it's also more hissy right so there's some trade-offs there but i think the overall sentiment is very positive on fp3 and you're probably right that it's just hardware it's just availability and supply constraints that held them back more than like some rejection of the product line probably just not as universal as airpods pro 2 maybe but still overwhelmingly positive i think happy hour this week is sponsored by hello fresh check them out at hellofresh.com slash happy hour 10 fm nothing tastes as great as home cooking and hello fresh makes it easy to do more of it with ingredients delivered to your door and recipes that feel good and taste delicious there's over 100 recipes to pick from each week with wholesome ingredients like sustainably sourced seafood and hormone-free chicken and they have new mediterranean and glp1 friendly options and you've tried HelloFresh, right Chance? 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That includes things like automatic payroll tax filing, simple direct deposits, health benefits, worker comp and more gusto makes it simple with options for nearly every budget you can save time with automated tools for offer letters onboarding materials direct deposits and more it's quick and easy to switch just transfer your existing data to get up and running fast and gusto lets you do unlimited payroll runs for one monthly price with no hidden fees or surprises so try gusto today at gusto.com slash happy hour and get three months free when you run your first payroll that's three months free of free payroll at gusto.com slash happy hour. One more time, gusto.com slash happy hour. Thanks to Gusto for sponsoring the show. Over the weekend, Apple updated its online store to kind of revamp the process of buying a new Mac. So historically on the online store, when you clicked the buy button on, for example, like the MacBook Pro page, you would first be taken to a landing page where you'd see those pre-built, pre-configured options with different chips, different RAM, and different storage configurations. And then you choose one of those starting configurations, and then you'd be taken to the actual configurator where you could kind of fine-tune things to your exact preference or proceed with that default. What they've done with this change is that landing page strategy is just gone. There is no more landing page. You click the buy button, you're taken directly to the configurator. And from there, it works a lot more like when you're buying an iPad or an iPhone where you choose your screen size, you choose your color, then you can go into choosing your chip, your storage and your RAM. There are still some pre-configure guidance throughout that process. But I think what's interesting is that they do seem to be steering you into i don't know choosing exact specs more than they did with the previous strategy i feel like with the previous design those three pre pre-configured options must have been by far on the way the most popular orders right yeah people would choose one of those that you had basically the entry model a slightly higher spec model and then a slightly higher spec model still and you could pick one of those three and yet it would take you through to the configurator where you could up upgrade it even more but i have to assume that most people would see those prices, they'd be like, okay, I want the $59.99 configuration. I'll click that one. I'll go onto the next page. I'll agree to everything, scroll all the way to the bottom and buy. This arrangement, it's much more hidden, I guess, about what everything's actually going to cost, right? Because you don't have those higher configs. One of the things that I would do whenever they announce new laptops, I'd get a screenshot of the landing page. So you could see the configs and the storage allowances and the memory and, you know, the number of CPU cores and stuff. And then when they refresh the store, you can quickly glance across and you can say, oh, now you get this for this price or whatever, or the base price has gone up slowly. Now there isn't really a, there isn't really like a middle tier pricing option. Like it's kind of buried because the configurator, you choose your screen size and you choose like your color and then you choose your chip. So in the case of like MacBook Pro right now, you have the M5 chip or you have the M4 Pro or you have the M4 Max. but regardless of what chip you pick you always get like the base size as the default option and then if you want to change your ram or your storage afterwards like it the customizations like subtitle literally is stay with the base model or make edits so maybe it's encouraging more people to stay with the base model configs or what i kind of think is happening is that it's going to allow them to add more options at every tier and rather than making like the landing page more complex with all these different models you basically just like separate it out into separate steps because the the choices for like ram and storage they don't even like show you them you have to like expand the little things right so like you don't even see the different ram options unless you press edit um and you can either see this is like a a redesign to make the increasing number of options more manageable or maybe it's a a way to kind of obscure how much each individual upgrade actually costs in a way so it's harder to compare and like and flick between like maybe if they're going to have to put ram prices up when they rev to the m5 pro m5 max i feel like this design kind of no it doesn't it doesn't obscure it because you can still see it but it just makes it a bit easier to like configure it to what you want and buy without being like in the details of oh when you press this it adds 500 and it takes 300 off here you know what i mean like it feels a bit more abstracted away the other thing this made me think of is there's been some kind of undercurrent of rumors that the m5 pro m5 max might be packaged differently where like the the cpu and gpu have kind of separated a bit so this hasn't been like definitely confirmed but there's been some like you know the weibo accounts things a few times over the last year have been like oh it's packaged differently so cpu and gpu are more separated so maybe there's going to be more options in terms of combinations of GPU and CPU can have. And you can imagine that you pick your headline chip for the M5 Pro when it comes out. And then in the customization thing, they just have the GPU options in another row. It might just be getting ready for that where there's just more. There's going to be more different versions of Mac you can have for every model. And their old way of laying it out wasn't quite going to scale. And so they've had to refresh it. I mean, I think you could already tell how the old landing page strategy wasn't scaling well. Like the MacBook Pro page, if you chose, like the default was it choose 14 inch and then it would show you every chip option and you'd have six different sort of pre-selected configurations from there. Six is, that's just too much information to put on one page, I think. And then you see there's two different 1999 configurations and you say, okay, what's the difference between those two? You're going back and forth between the little boxes on this page. putting it all onto the actual configurator, I think does make it easier to do those kind of side-by-side comparisons in terms of specs. And I think you're right that it maybe signals what Apple thinks people should prioritize, which is the most important thing you should choose is your chip, or that's what Apple wants you to think, because I don't actually think that's true. Yeah. I'd say storage is probably your most important choice. But you choose your chip, and then it's like here are your customizations, and you have to click again to make changes to that specific spec. So I think it's good that everything's on this one page and that whole landing page thing is gone. That was a bygone of a previous era, I think. But I just don't think that the chip should be the first and deciding factor in what other specs people see. The problem is the chip kind of waterfalls down what options you have for RAM and storage. So I guess that's why it's done that way. and it's like the headline thing is like the MacBook Pro we then file with the MacBook Pro. It's not your one terabyte MacBook Pro, you know? So I can see why it's done in that way, but it does, I do wonder if some people are going to like, more people are going to buy a config they don't actually want now because they're going to just scroll past the memory thing and they're going to be like, oh, you know, I've got my chip, right? Okay, customizer, yeah, I don't care about that section. Scroll, scroll, scroll. And then it's like, well, no, that's actually where you pick your RAM or your storage. And then you buy it and you're like, I actually want more storage or not. It is kind of funny to me that the options to buy a one-time license to Final Cut Pro and Logic are now take up more space than your choices for SSD and memory. Because the SSD and memory are collapsed behind an edit button and they do expand when you click on it, but by default they're minimized. Whereas Final Cut Pro and Logic have big buttons for no thanks and yes, pre-install. And there's one for Final Cut and one for Logic. So there's a bigger gap there, which is kind of amusing. Yeah, like there is also a part of me in my head, I'm like, are we overthinking this? Maybe they were going to redesign it anyway and it just coincidentally lines up with when we think there's going to be new laptops. But I wouldn't be surprised if the new ranges just have slightly more choices and maybe more binned CPU options so different options are available for you and like doing it this way kind of, it's almost like an accordion where they can hide away the different drawers that are more relevant to you. So yeah, I think overall it's a good change, but it's almost like I know I'm one of the customers that will be pressing the edit button on memory and SSD when I do upgrade the laptop. That's the thing though, is most people should. Most people should choose the edit button and probably get more storage than the default configuration. And I think this design kind of discourages that, which isn't good. The chip layout of the previous design and like looking at that landing page, Even I would get confused by the different bend options across each chip and how that impacted the base memory versus the top tier memory versus the base storage and the max storage. So yeah, overall, I think this is the right change. I just dislike how it seems to discourage people a bit from choosing their storage and their memory because those storage especially is just so important. And from Apple's perspective, that's where a lot of the margin is. so it's just kind of weird that those are collapsed like you said less so with the recent surges in yeah that's true yeah i know i know what you mean you also see it where like the macbook pro has the choice of m4 uh m4 pro m4 max or m5 like i i think the a18 macbook air thing could just be another option on the macbook air checkout page you know that's a good point yeah they could streamline it and just have it under one thing so you don't have a whole separate configurator for the cheaper Air and it's like you want basic performance then it's only $7.99 or you want the M4 chip and it's $9.99 so I do think there's some harbingers of what's to come and you mentioned the new MacBook Pros in Power On over the weekend Mark Gurman said that he's told the new M5 Pro and M5 Max MacBook Pro updates are slated to come during the macOS 26.3 software cycle. Apple just released the macOS 26.3 RC this week, which suggests a launch of 26.3 probably next week. Yeah, like Monday. Yeah, and what Gurman is saying is at some point during that cycle, between 26.3 and 26.4, that's when these new Macs will be announced. So sometime between February and March, basically. about what we expected. Then the other looming Mac hardware refresh is the Studio Display 2. German says that supply of the Studio Display 2 is of the original Studio Display is starting to dwindle, specifically the base configuration, and that he still expects it to launch sometime in the first half of this year. Good. You're still waiting. It's been a long time coming. Yeah. It's the first update since the Studio Display was launched as a product in 2022. Do you want to give me the bad news now? The bad news is, allegedly, is that an anonymous tipster who reached out to MacRumors, they say that the Studio Display 2 will have a refresh rate of 90 hertz instead of 120 hertz. No. That feels just so petty. You know what? That hurts. In 2020, wait, 2026, 90 hertz. and this isn't the first time we've heard this there was actually a rumor on the upgrade podcast i think in 2024 that said apple was exploring using 90 hertz on a handful of its products including the studio display 24 inch imac and the ipad air so instead of taking these kind of lower not lower end but like mid-range products all the way to 120 hertz they would do a middle ground of 90 hertz my counter they just they just moved the base iphone that's yeah that's my counter argument to that is they're doing 120 hertz on the base iphone the almost two thousand dollar studio display should have 120 hertz too you want the studio display to basically have the same screen as their laptops that they're selling you know yeah well it's not going to be mini led i don't think so i don't know about that you think so i don't there's been some people saying it will be it's been some people saying it won't well yeah some people say it'd be 120 and some people but i just don't see the the component cost like it's more expensive for them to do a mini led panel than it is to do a 120 hertz panel surely like yeah probably i just don't see what the the advantage for them is like not doing a 120 refresh rate it's not a modern technology anymore um especially if it's not gonna be a mini led panel um you know you just need a display driver that can do double the speed. We've been doing it on... The iPad's had 120 since, what, 2017? Mm-hmm. Yep. Like, and right now, the iPad's on, like, Tandem OLED Future, and the MacBook Pro's going to be on OLED Future. They're going to come out with a... an LCD or mini LED at best monitor, and it's not going to do 120 refresh rate? Surely not. Surely not. I mean, the... It is very common on the Windows side of display worlds to have like 240Hz refresh rate, you know? I know you don't get it at 5K, so there are some differences there, but I think they could do it. Like, I'd be really upset if it was 9Hz only. To put a bit of positivity, like, I think I personally am leaning towards that it will be 120Hz because the MacRumors report says that this is based on a leaked build of iOS 26 from like in early 2025. so I don't know how much I buy that compared to some of the more recent rumors that it'll be 120 hertz and then building off that I feel like Mark Gohm would have told me if it was only 90 hertz you know told you specifically yeah exactly he would one of his power newsletters he did drop that in there you know in the little QA section what can I expect for the sheer display and he'd be like well guys here's the bombshell it's only 90 hertz so we'd be all sad yeah I've got faith I've got faith in I do too the church of refresh rates yeah Going back to the MacBook stuff, though, how do we gauge the timeline between this M5 Pro and M5 Max update coming sometime within the next, say, 30 days? And then also rumors of the first M6 MacBook Pro coming later this year. That's a tight turnaround, but it's also something we've seen before in the Apple Silicon era, right? Yeah, I mean, they did this with the M2 and M3 Pro. so the m2 pro m2 m2 pro m2 max m3 pro m3 max they came out in 2023 the m2s came out in january and the m3s came out in october oh that's right yeah they are not opposed to doing that i assume in that situation the m2s were probably meant to come out like end of 22 and they got delayed to early 23 i that's generally my base is that they probably aim to do them in the holiday time frame you know like the november time frame um and then sometimes it's schedule slip and then it gets rolled over and then oh dear we're doing two releases in the same calendar year um so that could very easily be the explanation here too where maybe the m5 pro max is where men come out at the same time as the base m5 in the original planning you know so they'd be out now by now for three months and no one would bat an eyelid oh the m6 is coming the end of 2026 you know it just feel like normal um but because of the couple months delay then it feels a bit more tight but they've done it before they've done it with ipads in the past right where they did the you know ipad with retina display followed by the ipad fourth gen in the same year um so they're not they're not uh they they've never shown me that they're like never gonna do it you know they're not beholden to an annual calendar where they're like if we dare refresh something once in the year we're not gonna do it again if it suits whatever like their internal schedules are they do it so i don't have any pause that this would be the case i also think in this case there's even more motivation to explain it because i think they're gonna do my current position is the oled maver pros they're gonna do them as like a higher end option it's gonna be like pro ultra or something you know what i mean like some higher tier uh and they probably even have a world where they sell m5s and m6s simultaneously so like if you don't care about the super nice upgraded oled screen and it's meant to be touch sensitive right this this one yes yep yeah so if you don't care about like the OLED touchscreen thing, you can still carry on buying an M5 or you can spend the extra $500, $600, how much they're going to upsell you to get the OLED one. And that's what I would do. But I just think there's probably enough of a technological leap for them here. And it would also be a redesign year, presumably, right? Like I think the external chassis will change somewhat. It's supposed to be thinner. Yeah. Yeah. They're going to have to do something to make the hinge better if you're going to use it with a touch thing because they've got to make it more stable in the up thing. so it will have some sort of visual change to the hardware very easily i feel like they can have multiple models macbook pro on the page whether they're called just macbook pro with m6 or whether they make it like macbook pro super or so you know like super red or like they could brand it if they want to but i think they could just have them sold side by side at different price points just like they had with the macbook air for a long time right where they had they had the m2 m3 macbook cares on apple.com at the same time um and right now they have the m5 base maver pro and the m4 and the m thingy so yeah roll around to this 2020 the end of this year they could have m5 pros the m4 would fall off the lineup and then they'd have higher end m6s so that's kind of where i'm expecting it to land given the higher spec of the upcoming refresh for the m6 gen and also the supply chain environment of higher memory and RAM prices, storage prices, one way to preserve the margins is to introduce this OLED one at a higher level and just make people pay the difference. So you're thinking it's going to be kind of the inverse of what the strategy has been recently where it's the base MacBook Pro that gets updated first then the higher end once later? I don't think the base one will get touchscreen for ages. So the base is the M5 and then this fall they would do M6s and carry on selling the M5 base Yeah And maybe they would have some models of M5 Pro and M5 Max still available as well Yeah, that makes sense. Yeah. I'm very excited for these MacBook Pros, though. I think... The M6s, right? Yeah, the M6s with the OLED and with... I don't know how I feel about a touchscreen in terms of actually using it on a daily basis, but I'm excited to see how it works, and I'm excited to try it, and I'm excited for the MacBook Pro to get a little bit thinner again. I think they overcorrected a little bit with the M1 Pro redesign. So touchscreens, OLED, slightly thinner, hopefully a little bit lighter. I'm very on board, very excited for that. And you're updating too for the first time in like two decades, so. Two decades? No, I've got the M1 Pro. That's five years. Half a decade, half a decade. Yeah, half a decade, yeah. If they'd have done the OLED ones last year, I'd have done it last year, so. Yeah. It's Apple's fault, you know? Finally this week, Happy Hour is sponsored by Square. Square is the easy way for business owners to take payments, book appointments, manage staff, and keep everything running all in one place. Square supports every major payment method, including tap-to-pay, and offers instant access to your earnings through Square check-in. Square helps you run your business without running yourself into the ground. And right now, listeners can get up to $200 off Square hardware when you sign up at square.com slash go slash happy hour. That's square.com slash go slash happy hour. Now Chance, you must have a lot of businesses near you where you use Square to pay. 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Right now, you can get up to $200 off Square hardware at square.com slash go slash happy hour. that's sq u a r e dot com slash go slash happy hour run your business smarter with square get started today thanks to square for sponsoring the show apple announced this week that it is adding agentic coding support to xcode so this means that xcode now includes built-in integration with coding agents like Anthropics Claude Agent and OpenAI's Codex, and that's built directly inside of Xcode. So Apple announced this in a press release, which I think signals how, A, important they think the feature is, and B, how proud of the feature I think they are. And basically how this works is that one of these coding agents can now collaborate with a developer throughout the entire development lifecycle of a project. So the agent can search documentation, It can analyze the file structures of the project. It can update project settings and it can work using Xcode previews to look at the app, iterate through different builds to fix problems and just be involved in that entire lifecycle. So it's more of an integrated solution than just having like a like a like the previous AI integration into Xcode was an interactive chatbot on the left hand side that could make changes to your code. but it was still very siloed compared to what this is. Yeah, it was like if you had a sidebar of ChatGPT and we're asking it to edit files, right? And it would like make the edits and apply them to the files in your project but it didn't have like full access to all of Xcode's functionality. Whereas since, like when they probably first conceived that feature, that's all that was on the market, right? It was like chatbot type things that could write files for you essentially make code changes since um you know the the ai space moves so quick at the moment the the modern thing is like the agentic stuff where you can let agents go off and make you know pull requests and make changes for you on your behalf they have much deeper access to the system they need less prompting one of the examples here is like the coding agents can get the screenshots out of the xcode preview and use that to inform its updates and changes and check that it's actually making the changes that you want and things so um apple's kind of like catching up to offer the support for what are now very popular tools in the software engineering world, like Codex and Claude and things like that. And also what Apple's been using internally, right? I think the biggest proponent that you can say about this thing is they didn't wait till June, right? They have just rolled out a pretty significant update to the Xcode UI project capabilities in like a point update in February. So I think they're doing a good job but trying to keep a pace with what developers are actually doing when it comes to AI coding development. I mean, because if they had waited till June, everybody would just be saying, okay, they're six months behind when everybody started using Codex or whatever. Yeah, this should probably be out last year, right? So they're already catching up and who knows what the agents will be offering in June and then they'll have to rush to implement that as well. So I think this shows that they've got a good number of data. I feel like Xcode is well resourced, right? which you can't save for some of their developer tools and services in App Store Connect and all that stuff. But Xcode gets a lot of attention. I think they have a lot of pride in it. And this is a good example of that. So you're a developer, so do you use Codex or Cloud Code or anything? Maybe I'm a bit of a dinosaur. So far, I haven't really been using it. Oh, wow. I probably should. This is more a deficiency of me than a... But a lot of it comes down to, right now, codecs and things are much more suited to development in non-Apple platforms, right? They're much more productive when you're making websites in JavaScript and those kind of programming languages and making node projects for the web. They can deploy your web servers, right, and do open test browsers and things. The integration with iOS is more primitive because it's a bit more locked down, right, and Apple wasn't as supporting of it. This update actually gives me a lot more motivation to do it because they're giving the agents a lot more access. It's not just the UI inside of Xcode, which is a nice bonus, but it's not just that. It's just about the functionality availability to these agents to do things. I mean, Nestle at the bottom of the press release, they also said they're supporting MCP, which is a standard for interoperability, and it's what a lot of agents use to communicate with these things. So even if you're not graced with presence inside the Xcode sidebar, you can still access a lot of these features and take advantage of things and kind of build externally so the wider market is definitely I would say overall further ahead in adopting AI in general for iOS development it's definitely coming on and people using it and I do some stuff where like if I have a particular problem I like ask ChachiPity or something for some advice or can it go and find examples or something but in terms of the raw agentic stuff I haven't quite I'm a bit late to the party, but this kind of thing incentivizes me to do it, you know. It's more of a condemnation of you, not necessarily the technology itself, I guess. Yeah, but it is true that for iOS development, they've just been less capable before. Partly because Xcode limited them. And with examples like this, Apple's being very supportive of that ecosystem. Remember, this all started with Apple. the original plan was Apple to offer its own Xcode AI assistant. Swift Assist, right? Swift Assist, right? Which didn't actually exist. Or didn't exist in a good enough form to a ship. So the original UI for the Xcode code integration was built around Swift Assist, right? And then they had to kind of like backpedal and integrate third-party providers. I presume ever since they shelved Swift Assist, they then gone full pedal to the metal to integrate what you see now in Xcode 26.3. so you can take advantage of the cutting-edge agents from Claude and Anthropic and OpenAI. And I think you're totally right that Xcode is very well-resourced inside Apple just based on what I've seen and who I've talked to in my interactions with that team. And the reason for it is obvious, right? That's what Apple uses to make its own platform. So if Xcode falls behind, then Apple has a ripple effect across all of the platforms. And they have millions of developers paying $99 a year. So you don't need to create a studio You know, when you've got people paying for developer program access in the first place. And paying 30%, again, at the other side of that transaction, too, on the App Store. Yep, yep. I mean, they would be idiotic to make Xcode. I mean, I like Xcode a lot. There's some contingent of people out there who don't like it and think it's inferior to a lot of other IDEs. For iOS, you're kind of forced to use it, but I enjoy it. But I think you see a lot of care and attention. and when they do features in Xcode you can feel like it's been well designed and it was kind of slapped on I think it has a lot of taste in how they do stuff so yeah I'm a big fan I wish they would bring it to other platforms I mean the iPad is a great it's their own platform right they could do Xcode and iPad in a pretty good way and all they've already done is Swift Playgrounds which doesn't quite meet the muster they've done all the productivity enhancements of iPairs 26 I'd be a lot more incentivized to use it if I could actually do one of my core jobs with it and to do that I really need Xcode and there would be limits I wouldn't be able to use all the plugins and terminal access and I get that but still base Xcode if I could open like a Swift package and just work on it from an iPad it would give me a lot more opportunity to actually use iPads in my daily life Finally this week Mark Gurman at Bloomberg reports that CarPlay Ultra will come to at least one major new car later this year. He says that it's a Kia slash Hyundai model, and it'll come in the second half of the year. He doesn't say the specific model, but the publication Top Gear reported last year that Hyundai's upcoming Ioniq 3 EV will support CarPlay Ultra. The Ioniq 3 EV is expected to make its official debut in April and launch later this year. The key thing is that the price difference between the Ioniq 3 and the current Aston Martin cars with CarPlay Ultra is astronomical. So the Ioniq 3 is expected to be priced, I think, in the mid-30,000s, low to mid-30,000s, which is still an expensive car. Don't get me wrong. But the Aston Martins are, what, like at least $150? Closer to $200, yeah. Yeah, I'm pretty sure they're $200, the CarPlay Ultra spec ones. so that is a huge difference in price yeah and 30 grand car is not cheap but it's you definitely call it in the mainstream market you know especially for what's at least expected to be a pretty compelling ev i think i think it's going to be interesting too to see how carplay ultra adapts to an ev compared to a gas car and what affordances apple can make there compared to what they have to do for legacy reasons on an internal combustion engine car yeah and clear we're fighting for scraps in terms of adoption but yes anything please anything is good and getting it on a what seems to be a you know reasonably accessible entry-level ev vehicle is a good is much better than what they do with astermontan um which didn't help their kind of like high fluty tootie exclusivity you know yep aura because it was just they they obviously worked with who they could and who would let them uh but it's just not a good image thing to be like we only have it on super premium Aston Martins that no person would ever buy. This is a car that the average Apple customer could actually be buying. So it's a much better hallmark of their CarPlay Ultra platform. And it's in the price point too where a buyer can use CarPlay Ultra for Hyundai at least. A buyer can use CarPlay Ultra as a differentiator. If they're looking at two new cars, one from Chevy that's 35,000 or one from Hyundai that's 35,000 the Chevy car is not going to have CarPlay at all the Hyundai will have CarPlay Ultra that's going to be a deciding factor for people and that's probably or I would hope one of the motivations behind Hyundai coming on board with Apple in the first place and I would assume the Ioniq 3 has like more screens than what the Aston Martin do the Aston Martin has like the dashboard screen than that one like relatively small screen down below um the the the Hyundai Ionic EVs are closer to the the image that Apple shared for long with the X-Gen CarPlay with those big wide touch screens right and the you know you have the dash display and the ultra wide thing and stuff so it might actually be a bet just a better realization of what they want to do with CarPlay Ultra anyway because the hardware is better that they're using for it yeah if you look at the Hyundai Ionic 5 and what do they make the Ioniq 5 and the Ioniq 6 I think it is a big wide landscape screen it's actually two screens and there's kind of an ugly bezel in the middle of them but it is more screen you're right than the Aston Martin it's much more closer to the mock-ups from the next gen CarPlay from back in the day German also reiterates that Tesla is still working on CarPlay support not CarPlay Ultra just plain vanilla classic CarPlay 1.0 doesn't say when it's coming he says that we can expect more information quote unquote soon but it is nice to know that tesla hasn't backtracked on that which wouldn't have been surprising considering how quickly tesla changes its stances on a lot of stuff but they are indeed still working on carplay hopefully coming soon because i'm excited for that i'm very excited to see how those two systems work together just because for all of tesla's limitations their software infrastructure their software operating system is so, so good. And I think having CarPlay for things that you want CarPlay apps for specifically, combined with the robustness of just the Tesla native operating system, that is going to be a very compelling in-car sort of ecosystem, in-car infotainment system. And I'm excited to try that. All right. I think that does it for this week. You can find us on Apple Podcasts where you can leave a rating and a review. Find an ad-free version of the show with bonus content each and every week at 9to5mac.com slash join for $5 a month or $50 a year. Send us feedback happyhour at 9to5mac.com. I am on threads and elsewhere at Chance H. Miller. And Mayo, what about you? At BZMAY. All right. Thanks, Mayo. Bye-bye.