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Transcript

Apple’s Price Hikes Are Coming — Traders Need to Know Why · Earn Your Leisure

• 0:01
  Speaker 1: We glossed over a little bit. I think maybe we
• 0:02
  Speaker 1: touched on it for a second.
• 0:03
  Speaker 2: The fact that they are going to increase their prices
• 0:06
  Speaker 2: for the GPUs by 15%. Obviously, direct correlation to the
• 0:11
  Speaker 2: memory story. We talk about memory so much. Thoughts around that?
• 0:15
  Speaker 2: Because we saw memory take a bit of a hit today.
• 0:18
  Speaker 2: Outlook on the memory story.
• 0:20
  Speaker 1: You give your thoughts. I got mine for sure.
• 0:24
  Speaker 3: I think it's smart to increase the prices. It's too valuable.
• 0:28
  Speaker 4: And now for the first time in a long time,
• 0:30
  Speaker 4: the memory sector is in pole position to make the decision.
• 0:34
  Speaker 4: So much so, as we alluded to, Apple doesn't even
• 0:36
  Speaker 4: get to dictate price anymore. The memory company that used
• 0:40
  Speaker 4: to be the supplier was looked at as a little brother.
• 0:43
  Speaker 4: And now we take pole position because you didn't invest
• 0:45
  Speaker 4: your free cash flow or operation cash flow to buy.
• 0:50
  Speaker 3: Like, not to beat up on Apple because I love
• 0:53
  Speaker 3: everyone at HQ.
• 0:55
  Speaker 4: But look at what they could have potentially bought open AI, Anthropic, Micron, SanDisk,
• 1:01
  Speaker 4: because it was spun off.
• 1:02
  Speaker 3: Hell, Intel, you didn't do any of it. So the
• 1:07
  Speaker 3: costs are always going to be passed off to the consumer.
• 1:10
  Speaker 4: And everyone who keeps calling for the death of the
• 1:14
  Speaker 4: memory tray in one frame or another. I'm going to
• 1:17
  Speaker 4: keep saying it. You are only saying that because you
• 1:20
  Speaker 4: didn't get into it.
• 1:21
  Speaker 3: Same with Nvidia.
• 1:22
  Speaker 4: Like when I called Nvidia and it took off, they're like, oh,
• 1:25
  Speaker 4: it has remnants of Emron. I'm like, yeah, because you
• 1:29
  Speaker 4: didn't invest in it. That's the only reason why. So
• 1:31
  Speaker 4: do I see a potential for it to pull back
• 1:34
  Speaker 4: maybe to 830 if something bad happens or 809 or worse?
• 1:39
  Speaker 1: Sure.
• 1:39
  Speaker 3: Do I think we'll get back to 1200 within 12 months?
• 1:41
  Speaker 3: For sure. For sure. There's no money in being a
• 1:48
  Speaker 3: perma bear. What are your thoughts?
• 1:50
  Speaker 2: I think two things happened this weekend that made me.
• 1:56
  Speaker 1: I mean, I'm already bullish. I think everybody knows that.
• 1:57
  Speaker 2: I've been in the story for so long that, yeah,
• 1:59
  Speaker 2: of course, I'm a bull when it comes to the
• 2:01
  Speaker 2: memory sector.
• 2:03
  Speaker 1: I think the Tim Cook quote.
• 2:07
  Speaker 2: Was pretty telling in terms of them having to figure
• 2:11
  Speaker 2: out if they're going to try to use Chinese memory
• 2:15
  Speaker 2: products to help offset some costs. And him conceding and saying,
• 2:19
  Speaker 2: you know, Macron is an American leader in memory, and
• 2:21
  Speaker 2: we're going to continue to support that.
• 2:22
  Speaker 1: Yeah, but how do we even do that?
• 2:24
  Speaker 4: Like, we're fighting a geopolitical technological war.
• 2:27
  Speaker 1: The fact that he was testing it was just, like,
• 2:29
  Speaker 1: alarming in itself.
• 2:30
  Speaker 3: Like, bro, what?
• 2:31
  Speaker 1: Yeah. I mean, the administration, I couldn't see them allowing
• 2:34
  Speaker 1: it anyway.
• 2:34
  Speaker 3: Oh, they're not.
• 2:35
  Speaker 1: Yeah, they're not, right? That's the first sign.
• 2:40
  Speaker 2: And then the next day, Jensen saying we're going to
• 2:43
  Speaker 2: increase our GPU price by 15% is.
• 2:47
  Speaker 1: Also another bullish flag.
• 2:50
  Speaker 2: Because they could have said, hey, maybe we'll try to
• 2:53
  Speaker 2: create infrastructure that they've done in other sectors and said, hey,
• 2:56
  Speaker 2: maybe we find a cheaper way to do it. And
• 2:58
  Speaker 2: I'm sure companies out there that are looking to create
• 3:02
  Speaker 2: forms of memory that will be more sustainable at cheaper prices.
• 3:06
  Speaker 1: But until that point, and that'll.
• 3:08
  Speaker 2: Take three to five years minimum.
• 3:10
  Speaker 1: Minimum.
• 3:12
  Speaker 2: Until that time, this story is equally as important as
• 3:17
  Speaker 2: the GPU. We saw Sanjay speak on CNBC, and he
• 3:22
  Speaker 2: echoed the same exact words. This is as strong of
• 3:25
  Speaker 2: a story as the GPU because none of this works
• 3:28
  Speaker 2: if it can't remember. AI can't get better if it
• 3:30
  Speaker 2: can't remember. Simply put, he said AI can't get better
• 3:35
  Speaker 2: if it can't remember, if it can't learn, if it
• 3:38
  Speaker 2: can't train. In order to do that, you're going to
• 3:40
  Speaker 2: need memory. And so that's the fair indication that says, like,
• 3:45
  Speaker 2: this is still very much a bullish sector.
• 3:48
  Speaker 1: You know, I went deep in the research on it.
• 3:50
  Speaker 1: This guy's a legend.
• 3:53
  Speaker 3: Who, Sanjay?
• 3:54
  Speaker 1: A legend. What?
• 3:55
  Speaker 3: Yeah.
• 3:58
  Speaker 1: He's the CEO of Micron. You know the other company
• 4:02
  Speaker 1: he created?
• 4:02
  Speaker 3: What's that?
• 4:05
  Speaker 1: Sandisk.
• 4:06
  Speaker 3: Mm-hmm.
• 4:08
  Speaker 2: He's the creator and founder of Sandisk, left in 2016
• 4:12
  Speaker 2: to take Micron, and now look at what those companies
• 4:15
  Speaker 2: are doing. Think about the conviction he's had for this sector,
• 4:19
  Speaker 2: from a NAND standpoint, and now from a high-bandwidth standpoint,
• 4:22
  Speaker 2: and where that is going.
• 4:24
  Speaker 1: To lead over the next five to ten years. That's
• 4:27
  Speaker 1: pretty legendary shit.
• 4:28
  Speaker 3: That's iconic, bro.
• 4:30
  Speaker 4: And also, the Indian CEO index, if you want to
• 4:35
  Speaker 4: parse through the data, higher returns.
• 4:38
  Speaker 3: For sure.
• 4:40
  Speaker 1: Sanjay's one of them ones. He's one of them ones.
• 4:45
  Speaker 2: It's at a perfect time because his belief in the
• 4:48
  Speaker 2: memory landscape, again, this was a game thing.
• 4:50
  Speaker 1: I don't think people understand. This was a gaming thing.
• 4:55
  Speaker 4: Same way that video technology developed in an underworld market
• 5:01
  Speaker 4: and then became mainstream, memory has become the same way.
• 5:06
  Speaker 4: If you want to find the next breakout company that
• 5:09
  Speaker 4: is not mainstream yet, they're going to be in a niche.
• 5:12
  Speaker 4: Go look at a company that is dominating and mastering
• 5:15
  Speaker 4: a niche. You're going to see your next great company.
• 5:18
  Speaker 4: And if you look at a founder that is incredibly diligent,
• 5:22
  Speaker 4: not on the scenes, not on Twitter, getting into catfights,
• 5:27
  Speaker 4: you will be able to identify some amazing companies. But
• 5:31
  Speaker 4: it's really important that you use the product and love
• 5:33
  Speaker 4: the product. Like even in Apple, for them to say,
• 5:36
  Speaker 4: we may use a Chinese memory company.
• 5:39
  Speaker 3: Why? And you have a leasing program for every product.
• 5:41
  Speaker 3: It makes no sense.
• 5:43
  Speaker 4: But like you are getting the phone subsidized from day one,
• 5:47
  Speaker 4: either through Singular Wireless back in the day or now
• 5:49
  Speaker 4: through the leasing program that you can pay the monthly on.
• 5:53
  Speaker 4: So they're one of the first biggest companies that are
• 5:55
  Speaker 4: going to introduce the rent everything, own nothing kind of concept.
• 6:00
  Speaker 4: It makes no sense to have that kind of stance
• 6:02
  Speaker 4: to Apple.
• 6:04
  Speaker 2: Not this is the reason we have to yeah this
• 6:06
  Speaker 2: is the reason we're in quite i'm like you've been
• 6:08
  Speaker 2: increasing prices for the past five years when it wasn't.
• 6:10
  Speaker 4: Memory since 07 you've been increasing prices what's it called
• 6:15
  Speaker 4: what okay yeah so and you came out with the
• 6:18
  Speaker 4: macbook neo and all it's like you don't have to
• 6:21
  Speaker 4: increase price you don't have.
• 6:23
  Speaker 2: To yeah we looked at the profit margins guys you
• 6:27
  Speaker 2: don't technically have you have.
• 6:29
  Speaker 4: A Bro, even NVIDIA. NVIDIA is set to do $ 92 billion.
• 6:33
  Speaker 4: The Bahamas make $ 16 billion a year. These are countries
• 6:38
  Speaker 4: we're talking about. Apple has a bunch of cash available.
• 6:42
  Speaker 4: If they wanted to buy a memory company and bring
• 6:44
  Speaker 4: it in-house, they could have.
• 6:48
  Speaker 1: That's the part, though. If they say that they don't...
• 6:52
  Speaker 1: This is a bottleneck. It's this, right?
• 6:57
  Speaker 2: You'll hear shareholders say, hey, our profit margin has gone down.
• 7:02
  Speaker 2: So it's like you kind of got to do it
• 7:05
  Speaker 2: because if sentiment starts to change and we already saw
• 7:09
  Speaker 2: that it's beating every quarter, it still drops because great
• 7:14
  Speaker 2: or exceptional isn't exceptional enough. It's like, you know what?
• 7:19
  Speaker 2: We understand that, can see that there's a cost increase,
• 7:21
  Speaker 2: so we're going to have to pass that on. Rather
• 7:23
  Speaker 2: than saying, hey, we'll eat that cost. How long can
• 7:25
  Speaker 2: we eat it? Well, then operating margin goes down. then
• 7:29
  Speaker 2: profit margins down. And when people start to see a decline,
• 7:32
  Speaker 2: like they can say, hey, our gross margins are going
• 7:36
  Speaker 2: to be 74.5%.
• 7:37
  Speaker 1: If the street expects 75, oh, wait, we saw a decline.
• 7:39
  Speaker 1: All right, hold on, hold on.
• 7:41
  Speaker 3: I mean, that's why I agree with Sam. I'll take
• 7:44
  Speaker 3: the shares.
• 7:44
  Speaker 4: Even in having shareholders, I think it's really important to
• 7:48
  Speaker 4: paint the vision. And this is what Steve Jobs is
• 7:50
  Speaker 4: really good at, to not focus on the one or
• 7:53
  Speaker 4: two year cycles and tell you where you're going to
• 7:55
  Speaker 4: be in year 10. People held on for Apple for
• 7:58
  Speaker 4: 10 years from 05 to 2015.
• 8:01
  Speaker 3: Illustrious track record.
• 8:03
  Speaker 4: If you want to get off the ship and as
• 8:05
  Speaker 4: a leader, you have to tell the troops, hey, you
• 8:08
  Speaker 4: may not agree with this short term. I have to
• 8:09
  Speaker 4: do all the time. But this is what's best for
• 8:11
  Speaker 4: the brand long term. You got to get the shareholders
• 8:15
  Speaker 4: on board to follow the vision.
• 8:16
  Speaker 1: All right.
• 8:17
  Speaker 2: All that being said, I think it beats again the
• 8:20
  Speaker 2: earnings report. I think they see a different direction. I
• 8:24
  Speaker 2: think I think the stock actually glimpsed. I think it climbs.
• 8:28
  Speaker 3: Okay.
• 8:29
  Speaker 2: Yeah.
• 8:29
  Speaker 1: We'll see.
• 8:30
  Speaker 2: I just got this feeling like the momentum, obviously we've
• 8:33
  Speaker 2: seen it pulled back, but we've seen that before when,
• 8:36
  Speaker 2: when it's want to have better.
• 8:38
  Speaker 1: Buying opportunities, we'll start to see stock slide a little bit. Yeah.
• 8:42
  Speaker 2: I think with the momentum, I think with the PE
• 8:43
  Speaker 2: ratio pulling down a little bit from where it's, it's
• 8:46
  Speaker 2: high as where I think we see it in first, but.
• 8:48
  Speaker 1: Wednesday is a Superbowl. We'll be watching.
• 8:50
  Speaker 4: Most importantly, hold for 10 years, please. Stop trading your
• 8:54
  Speaker 4: way into poverty. Thinking you're going to get an extra
• 8:58
  Speaker 4: $ 12, 000 out of a move that may cost you $ 200, 000
• 9:01
  Speaker 4: in five to six years.
• 9:04
  Speaker 1: Please, please. So that'll happen Wednesday. CrowdStrike also on Wednesday.
• 9:10
  Speaker 1: Both in the portfolio, definitely watching both.