Tim Cook Worked Hard to Sell Us on Apple’s Future while CFO Luca Maestri Apologized
I noticed something interesting during Apple’s quarterly conference call with analysts on Tuesday: during opening remarks, Tim Cook was working hard to sell the message that Apple is doing well despite turning in a “challenging” quarter. I’ve never noticed Tim Cook trying to sell it during a call, but then I heard something else that was new: CFO Luca Maestri’s tone during opening remarks was apologetic.
For instance, Tim Cook said, “Despite the pause in our growth, our results reflect excellent execution by our team in the face of ongoing macro-economic headwinds in much of the world and difficult year-over-year comparisons. […] For the first half of the fiscal year, our revenue in constant currency was up 1 percent year over year.”
There’s so much in just that little quote that is salesy. There are caveats, there is praise in the face of poor(er) results, and there’s a little misdirection by talking about revenue (in constant currency, another caveat) for the first half of the year—Mr. Cook slightly emphasized “half”—when talking about this quarter’s results.
But above and beyond the words, there was Mr. Cook’s tone of voice, his cadences. And it wasn’t just me. Jeff Gamet, John Martellaro, and I all independently recognized how different Mr. Cook’s tone of voice was throughout his opening remarks.
The same with Luca Maestri, who said, “Sequentially, our guidance implies a revenue decline of 15 to 19 percent, which is comparable to the 17 percent sequential decline that we’ve averaged from the March to the June quarter for the past 3 years, despite the anticipated channel inventory adjustment [described earlier in the call].”
There are a lot of caveats and explanations in that snippet, but it was the way he delivered all of his comments that included a tone of apology I’m just not used to from Mr. Maestri.
Tim Cook selling it and Luca Maestri apologizing for it? What has the world come to?
I doubt either approach was planned. Instead we were witnessing human nature at work. Tim Cook believes in his company’s future, but knows it hit a rough patch for a couple of quarters—a rough patch made rougher by a comparison to a stunning year-ago quarter where Apple blew everyone away. As such, any human CEO is going to be predisposed towards selling a positive message to investors and analysts.
Similarly, Luca Maestri’s apologetic tone was understandable. As chief financial officer, he is responsible for the bottom line in a way that’s separate from the CEO’s shared responsibility. Laying out the results and constantly pointing to tough comparisons, reductions in channel inventory, currency challenges, and other factors that made this quarter the first year-over-year decline in 13 years is part of his job, and it’s human nature to sound apologetic about it.
Another interesting observation (to me) was that as the questions from analysts wore on, Tim Cook’s intonations, cadences, and presentation reverted to his usual no-nonsense manner, while Luca Maestri also drifted back from apologetic to merely informative. Again, this is just human nature as that is likely where both men are most comfortable. The sales job and the apologies just aren’t in their nature.
Does any of this mean anything? Not really, but both performances stood out for me as very different from past conference calls, which is in keeping with the reality that these results are very different from past quarters.
And for the record, I personally needed neither the sales job nor the apologies.
*In the interest of full disclosure, the author holds a tiny, almost insignificant share in AAPL stock that was not an influence in the creation of this article.
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