Apple versus Dojo
EDITOR'S NOTE
We were talking in Rapid Fire yesterday about the impressive year-to-date stock performance of a lot of the "old tech" names like Cisco (up 30%), Oracle (same), and Dell (same). The companies hate that label, of course, especially when Oracle's running a $10 billion cloud revenue rate. But the whole reason investors have liked these plays is that they see them catching up with the times and pivoting their business models accordingly. Then, you get growth and dividends! (Sometimes.)
Anyhow, when I moved on to talk about Apple ahead of today's product event, where they're expected to launch the iPhone 13, Molly Wood of Marketplace interjected to point out that she would frankly lump Apple with "old tech" plays now. And sure enough, we've heard one person after another coming on CNBC and shrugging off today's event as "incremental, not revolutionary," or however the saying goes.
To be fair, it is a huge testament to Apple that the very societal epoch they pioneered--that of the dazzling, live-streamed tech product launch--has now been commoditized. But that's just the way it goes. And again, "old tech" can still be a pretty lucrative business, and Apple's a nearly $2.5 trillion company now whose shares are still up 13% this year.
The product launches that people really care about these days are probably Tesla's, crypto's, NFTs'...heck, even "Zoomtopia" this week was kind of buzzy. Zoom is redesigning its video chat, to be launched sometime in the next few months. Tesla, meanwhile, blew people away at its AI day talking about the computing breakthroughs the company has achieved. And the craziest part is you can still watch the entire thing on YouTube.
Here's how one observer described it: "Tesla's new Dojo computing architecture got some love...with a pretty thorough breakdown of the new system's distributed architecture and interconnected Learning Units...Acting like the Tensor cores in Nvidia's latest GPUs, these would be networked together in a fabric and form the building blocks of the Dojo D1 chip, which itself would be arrayed on a single die with the other D1 chips to make up a Dojo tile." Got all that? (And you should see what the tile itself looks like.)
Now, we all acknowledge the massive increase in shares of Nvidia and AMD as they've pressed ahead on the bleeding edge of computing technology. Nvidia is up nearly 1,400% over the past five years! But by those standards, and given the somewhat analogous technology it's apparently working on "under the hood," and the fact that they also make pretty popular EVs, Tesla's own 1,800% gain during that same period actually looks kind of in-line.
Apple shares, meanwhile, are up about 480% during this time. The company may very well have its own fancy computing architecture to show off at other events, but it's not part of this auto-chip discussion. As fun as iPhones and watches and Air Pods and all the rest of it are, the company just isn't seen as working on anything that could fundamentally change society anymore, the way Tesla could with driverless cars if Dojo actually "works."
If the leading edge of chip design and technology is really moving to the car, Apple would still seem to be extremely well-positioned to capitalize on that; just look at how well-received its M1 chip launch (for iPads and computers) was. Then again, the guy leading its car efforts internally, Doug Field, was just hired away by Ford. And as Bloomberg has reported, "despite [Apple] starting the project in 2014, work on an autonomous electric vehicle is still in an early stage." Perhaps most telling of all is simply that Tesla has left its entire chip architecture discussion on the internet, for any competitor to see.
So yes, I always like seeing Apple's new products, and we'll definitely bring you the highlights during the show today. It just feels like each year, there's less and less at stake.
See you at 1 p.m!
Kelly KEY STORIES
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