We’re seeing a big jump in iPhone Pro model lead times today, launch day, which underscores that the splitting of the cycle is working. $AAPL P.S. The Street is way too low on Duo in FY27.

Looks like Apple iOS servers are a little overloaded, given it's taking longer than usual to update to the new iOS 27 that came out about 1p ET. This is similar to what happened when Apple Intelligence was released in October of 2024. The new Siri AI: Cons: It takes way to long, 5-15 seconds to get a response. Pros: It's the first compelling case for personalized AI. I can have it search email and text at the same time. $AAPL

iPhone Lead Time Tracker 3 days into Pre-Orders: We're seeing average lead times of 2.6 weeks across 8 countries. That's in line with where the Pro models were last year. My take: Most importantly, the lead times jumped from 1.6 weeks yesterday to 2.6 weeks today. Part of that jump is people are back in front of their computers (pre-orders started on Saturday). The important part is lead times are going up, which has historically been a favorable sign for demand. $AAPL

Tough day for the AI trade, with many of the key names down 4-8% on Dario’s call to slow AI. We need to put the conversation of an “AI slowdown” into perspective. We’ve been going at 200 mph, and if everything that Dario recommended comes into play, the speed of AI progress will be dialed back to 195 mph. There’s no way these companies are going to measurably back off for two reasons: 1) The Prisoner’s Dilemma is in play. If one maintains its pace, the others that dial it back will be at a significant disadvantage. 2) The China-US dynamic is real, and at a minimum, the US has to keep pace with China. The bottom line: we’re not changing our enthusiasm around investing in AI. Little will change, and these stocks will rally in the future. PS: Anthropic will still have a blockbuster of an IPO.

Dario, Musk and Altman just tried to tap the brakes on model improvements. Unfortunately for AI safety, the race is too intense, and I expect little to change in the leapfrog game.

Shares of $AAPL moved about 7% from the end of the “Surprise and Shine” event to close of market today (2.5 trading days), while the Nasdaq was flat. The move higher underscores that investors are optimistic that the new Duo will add a measurable amount to revenue in the coming year. That said, a look at FactSet analysts estimates reveal consensus revenue expectations for the next three quarters actually went down by 1% for analysts that have updated their models. The dynamic of shares of AAPL going higher while numbers are going slightly lower underscores the mixed investors feelings on the Duo topic. In the end, I expect Duo will be more successful than current expectations and account for around 12% of overall iPhone revenue in FY27, and add 3% to the company’s overall growth rates.

I stumbled on a small speedbump for iPhone in China. While Apple is still taking China pre-orders tomorrow, the 18 Pro and 18 Pro Max don’t have approval for sale (see image). Last year the same red “release after approval” note showed up on iPhone Air, because it was eSIM-only. My guess is the hang up this cycle is also related to the eSIM and should be sorted out over the next week.

The collective opinion on iPhone Duo seems to be flipping people who never thought they wanted a foldable phone. They’ll likely come from Pro and Pro Max. Good news for AAPL given that’s a 60% average ASP bump.

iPhone Duo will appeal to consumers who can’t get enough content. Unfortunately for humanity, and fortunately for $AAPL, that’s a big market. The $2k price point breaks down to $58 a month vs $35 for Pro Max.

If a third of the Pro Max buyers switch to Duo in the next year, that would increase overall iPhone revenue by 5%, and overall Apple revenue by 2.5% in FY27. That excludes any iPhone Pro or lower customers making the jump. In other words, even with somewhat conservative assumptions, the Duo can have a measurable impact to the business.

Most important takeaway from the $AAPL event : The Duo matters because this is the first time since AirPods in December, 2016 that Apple announced a new product people will really want. Vision Pro missed the mark.

What does a $1,999 iPhone Duo translate to monthly payments? iPhone Duo is about $58/month vs. $35/month for iPhone Pro Max. Thinking about it as an extra $23 a month means we will see a measurable percentage of people jumping from Pro Max to Duo. I'll look into impact on overall product will help revenue. More to come. $AAPL

I dont want a bigger phone in my pocket, but Duo looks shorter, wider, and pretty thin. Hard to say how it’ll compare to a Pro in your pocket. But many will consideration size in my pocket and hand… not the price. The Pro and Pro Max are already expensive ($1k+), so I don’t think the stretch to $2k is much of a stretch for folks alreadying buying $1k+ phones. $AAPL

The new foldable iPhone Duo is sick. No seam. Ultra thin. 50% larger screen than Pro Max. My take: They're going to sell more than I thought before seeing it. I was thinking it would account for 5% of iPhone revenue in FY27. Now I think likely going to be 10%. The issue is the price. We don't have it yet, but it will be $2k plus. $AAPL

NHTSA needs a wake-up call. The agency rained on the $TSLA Cybercab launch by opening a probe into Tesla’s self-certification — specifically whether a vehicle with no steering wheel or pedals meets federal safety standards. Question for NHTSA: why slow the rollout of autonomous vehicles when the best data we have says they’re 7-10x safer than human drivers? I suspect the answer is the march of nines. With all due respect, NHTSA needs to update the rules written for human drivers and move faster. About 37k people died on U.S. roads last year. If robotaxis delivered even a 7x cut in fatalities, that number would be closer to 5k.

Elon’s post over the weekend that we’ll still need natural gas to power data centers for the next several years underscores power as an underappreciated investment theme. It reminds me a little bit of when Nvidia’s business began to take off in CY23. It was clear to the market that GPUs were an obvious investment theme, but the market missed the magnitude of the growth potential. To put it into perspective, from mid-CY23, when it was clear that Nvidia was going to be an AI darling, to today, the stock is up 416%. That compares to the Nasdaq, up 92%. In other words, it makes sense to put new money to work in power. That’s what we’ve been doing at Deepwater with our private power investments, which include @antoraenergy, @RedwoodMat, @StonePowerUS, and @boomsupersonic.