Apple faces risk from memory cost spike in 2026: MoffettNathanson's Moffett
December 19, 2025 • 4m 34s
Jon Fortt (Anchor)
00:00.110
well
turning
now
to
apple
it
hit
a
record
high
recently
but
the
stock
has
lagged
much
of
the
year
compared
to
mac
seven
peers
so
will
it
break
out
or
lag
again
in
twenty
twenty
six
let's
ask
craig
moffett
from
moffett
nathanson
craig
isn't
what
really
matters
here
if
apple
comes
Jon Fortt (Anchor)
00:17.750
out
with
apple
intelligence
this
time
and
if
it
delivers
as
expected
Craig Moffett (Partner & Senior Analyst)
00:27.030
hey
john
i'm
not
sure
about
that
actually
look
it
lagged
for
a
lot
of
reasons
during
twenty
twenty
five
but
there
were
there
were
a
lot
of
risks
in
the
stock
we
opened
the
year
actually
i
remember
you
had
me
on
back
in
january
we
had
a
sell
rating
on
it
it's
not
a
sell
anymore
Craig Moffett (Partner & Senior Analyst)
00:45.800
it's
sort
of
neutral
it's
a
fairly
valued
stock
i
think
but
but
i
think
that
what
looking
at
it
going
forward
i
think
the
big
question
is
really
about
services
i
don't
think
we're
going
to
get
the
kind
of
giant
super
cycle
of
iphones
that
we
once
thought
we
were
going
to
get
Craig Moffett (Partner & Senior Analyst)
01:05.550
maybe
eighteen
months
ago
when
they
came
out
of
the
WWDC
and
everybody
thought
that
AI
was
going
to
make
you
upgrade
your
device
to
a
more
capable
device
i
i
don't
think
that
narrative
is
really
what's
relevant
to
the
stock
anymore
i
think
people
have
come
to
terms
with
the
fact
Craig Moffett (Partner & Senior Analyst)
01:22.670
that
that's
probably
not
likely
so
instead
you're
looking
at
a
company
that
is
really
really
good
at
what
it
does
it's
a
relatively
expensive
stock
and
and
the
swing
factor
might
actually
just
be
services
and
the
general
growth
of
the
services
revenue
for
the
business
going
Craig Moffett (Partner & Senior Analyst)
01:41.670
forward
more
than
it
is
actually
on
hardware
or
or
specifically
on
AI
let
Jon Fortt (Anchor)
01:46.430
me
throw
another
idea
at
you
apple
has
not
been
spending
nearly
as
much
as
a
percentage
of
revenue
on
AI
infrastructure
as
any
of
the
other
names
in
big
tech
arguably
because
they
they
don't
have
to
but
i
guess
you
could
come
down
a
lot
of
different
ways
there
since
we're
Jon Fortt (Anchor)
02:03.590
talking
about
potential
performance
in
twenty
six
relative
to
peers
doesn't
some
of
that
depend
on
how
optimistic
investors
remain
about
the
potential
return
and
how
soon
on
all
of
that
AI
infrastructure
investment
you're
Craig Moffett (Partner & Senior Analyst)
02:17.630
you're
dead
right
john
i
in
fact
i'll
say
it
even
more
bluntly
apple
is
seen
as
the
the
safe
choice
so
the
biggest
determinant
of
what
apple
's
relative
performance
is
going
to
be
is
not
how
well
apple
does
it's
how
well
the
rest
of
the
mag
seven
does
in
a
big
rally
for
or
Craig Moffett (Partner & Senior Analyst)
02:36.680
continued
rally
for
AI
apple
is
going
to
underperform
in
a
pullback
apple
is
going
to
be
i
would
suspect
by
far
the
best
defensive
of
the
mag
seven
so
it
is
rightly
seen
i
think
as
the
safety
choice
of
of
the
mega
caps
because
it's
not
capital
intensive
and
and
not
really
Craig Moffett (Partner & Senior Analyst)
03:00.310
dependent
on
the
AI
story
so
much
so
Jon Fortt (Anchor)
03:03.430
let
me
put
a
spin
on
that
then
if
the
rest
of
the
big
tech
players
continue
to
do
well
because
there's
AI
optimism
aren't
people
going
to
have
to
access
those
AI
driven
services
on
something
like
i
don't
know
iphones
Craig Moffett (Partner & Senior Analyst)
03:19.710
sure
yeah
the
question
is
so
let's
let's
parse
the
the
AI
opportunity
for
apple
a
little
bit
more
finally
right
when
they
came
out
of
the
WWDC
eighteen
months
ago
the
assumption
was
that
everything
apple
was
going
to
do
was
going
to
be
on
the
device
and
by
virtue
of
doing
it
on
Craig Moffett (Partner & Senior Analyst)
03:40.350
the
device
you
were
going
to
need
more
memory
you
were
going
to
need
a
neural
processor
in
the
device
that
meant
that
the
bulk
of
of
legacy
phones
weren't
capable
of
doing
AI
and
so
there
was
going
to
be
a
big
big
upgrade
cycle
and
so
on
we're
now
looking
at
a
future
where
it's
Craig Moffett (Partner & Senior Analyst)
03:56.670
much
more
likely
that
you're
going
to
be
doing
that
processing
in
the
cloud
which
by
the
way
is
what
chat
GPT
does
it's
what
claude
does
at
anthropic
it's
it's
what
gemini
does
so
apple
was
going
to
be
the
outlier
anyway
and
apple
's
looking
like
less
of
an
outlier
it
looks
like
Craig Moffett (Partner & Senior Analyst)
04:16.150
more
of
that
will
be
done
in
the
cloud
that's
fine
it'll
it'll
work
well
and
you'll
be
doing
it
on
your
device
but
it's
not
clear
that
that
actually
generates
any
incremental
revenue
or
anything
like
an
iphone
cycle
because
you
could
do
that
today
you
don't
need
any
particular
Craig Moffett (Partner & Senior Analyst)
04:31.430
new
capabilities
in
your
phone
in
order
to
do
that
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