Let’s Set Aside the Pleasantries, Tesla Is Going to Crush Traditional Automakers. $Tesla(TSLA.US)
Source: Gene Munster
Gene Munster
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One well-paying job I would never want: chair of a traditional automaker. $Tesla(TSLA.US)
Source: Gene Munster
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Tesla Deliveries land tomorrow a.m.: The EV Winter Thaws
• For the Sep quarter, the Street is looking for 461k, down 7% y/y.• I’m looking for 497k, which would be flat y/y.• The Street’s looking for a decline because of the tough comp from the US EV tax credit sunset last September.• The broader EV commentary has turned more cautious recently, with sales of GM EVs down around 70% y/y.• I believe the opposite is happening, that we’re exiting the EV winter that started three years ago. Tesla demand is stronger than expected based on a combination of continued high gas prices and the word slowly getting out that FSD is the real deal.• U.S. extended lead times point to stronger demand. I estimate about 40% of deliveries are in the U.S. Since last fall, Model Y and Model 3 lead times have essentially doubled, going from around 5-6 weeks to about 10 weeks. That’s an average across all trims. $Tesla(TSLA.US)Source: Gene Munster
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OpenAI dev day kicks off. Bottom line: This personalized AI thing is going ballistic.
Altman announces dots, a bot that competes with Muse, Siri, Grok Bot, Poke. He calls it the "real version of AI that we have always wanted".Source: Gene Munster
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Personalized AI bots will blow the everyday tech user away in the next year. Good news for $SpaceX(SPCX.US), $Apple(AAPL.US), $Meta Platforms(META.US), Cognition.
Today, my guess is less than 1% of the US population understands how powerful these new personalized AI bots are. That's going to quickly change.Here at Deepwater, we're testing Siri, Grok Bot, Muse, Poke, and Gemini Spark.In the past month, we have noticed the usefulness of these bots has gone off the charts. Specifically, a number of everyday inefficiencies, like getting caught up on the news, sifting through spam, and prepping for the day, are now reliably automated.And we're just at the start.Source: Gene Munster
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This is a bigger week than most investors realize for $SpaceX(SPCX.US) and they’re just scratching the surface.
Monday: Starship’s first orbital mission deployed 26 Starlink V3 satellites.Thursday: Three launches. First, a Falcon 9 launch from Florida with four crew members going to the International Space Station. Second, Falcon 9 will launch from California with 103 payloads. Third, Falcon Heavy will launch NROL-97, a U.S. spy satellite, from Florida (a different pad than the one earlier in the day).Long-Term Launch Targets: This year, SpaceX will do about 170-180 missions. In August, Musk said that by 2030, the goal is 30 Starship launches a day. If they run Mon-Fri, that’s 6k a year. In other words, we’re 3% of the way there.The Key Question: What is the real launch number in 2030? I believe a more likely number is 2,200 by 2030, which implies about doubling every year. If they get to that 2k-plus number, my guess is the stock more than doubles from here. A double would imply an average annual return of 30% during those four years.Source: Gene Munster
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The whole Muse conversation gets back to the value of personalized AI. I expect that in the coming years a high percentage of consumers will pay $10–20 per month for its features.
If these agents ultimately become as powerful as I expect, subscriptions alone will have a material impact on $Meta Platforms(META.US), $Apple(AAPL.US), $SpaceX(SPCX.US), and, to a lesser extent, $Alphabet - C(GOOG.US).Source: Gene Munster
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I'm standing by my Aug 14 prediction that early next year Grok will land a top spot on the Artificial Analysis Intelligence Index.
My reiteration comes in a week that Grok lost ground on the AI leaderboard, moving from 4th on Aug 14 (Grok 4.6) to 7th place (Grok 4.7).My optimism is based on a belief that Grok 5, fully trained on Space X data, will be a game changer. $SpaceX(SPCX.US)Source: Gene Munster
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iPhone 18 Pro model lead times continue to point to a successful cycle split. $Apple(AAPL.US)
As of this morning, lead times for Pro and Pro Max are still 4% and 3% higher than they were a year ago, which is a positive given I would've expected shorter lead times this year because of Duo cannibalizing Pro models.As a point of reference, the lead times for the 18s were 15% and 18% higher than the 17s on launch day:Source: Gene Munster
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For all the heat that Elon gets on product delays, it's worth noting that he effectively shipped a product on time today. In August, he predicted Grok 4.7 would go live on 9/1, which in my view is essentially the same as 9/21.
This increases the odds that Grok 5, which will be a game changer (mark my words) comes out more or less on time. Elon said that would be late this year.What's going to make Grok 5 special is it's “incorporating the entire corpus of SpaceX data. Basically, all the data that SpaceX has ever produced, which is a tremendous amount over the course of a quarter century.” Translation: Grok 5 will be the most useful engineering tool in history.Source: Gene Munster
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$Meta Platforms(META.US) finished +11% today. That’s good news for $Tesla(TSLA.US), $Apple(AAPL.US) and $SpaceX(SPCX.US).
We knew Muse was coming for 6 months. The stock is ripping because the broader market has now used the product and finally gets how good it is.That same rip higher dynamic is next for these mega caps, in order:$Apple(AAPL.US) on Duo demand$Apple(AAPL.US) on the new Siri (personalized AI)$Tesla(TSLA.US) on FSD$Tesla(TSLA.US) on Cybercab$SpaceX(SPCX.US) on orbital data centers$Tesla(TSLA.US) on OptimusSource: Gene Munster
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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. $Apple(AAPL.US)
P.S. The Street is way too low on Duo in FY27.Source: Gene Munster
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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. $Apple(AAPL.US)Source: Gene Munster
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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. $Apple(AAPL.US)Source: Gene Munster
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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.Source: Gene Munster
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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.
Source: Gene Munster
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Shares of $Apple(AAPL.US) 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.Source: Gene Munster
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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.Source: Gene Munster
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iPhone Duo will appeal to consumers who can’t get enough content. Unfortunately for humanity, and fortunately for $Apple(AAPL.US), that’s a big market. The $2k price point breaks down to $58 a month vs $35 for Pro Max.
Source: Gene Munster
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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. $Apple(AAPL.US)Source: Gene Munster
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Most important takeaway from the $Apple(AAPL.US) 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.Source: Gene Munster
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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. $Apple(AAPL.US)Source: Gene Munster
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Big picture on new iPhones, AirPods and Watch is these devices will be increasing listening to us and processing what they hear with personalized AI.
My take: New world order. $Apple(AAPL.US)Source: Gene Munster
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NHTSA needs a wake-up call.
The agency rained on the $Tesla(TSLA.US) 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.Source: Gene Munster
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Yesterday, PwC came out with their long-run global AI data center spend report. My take is that their estimates dramatically understate the staying power of data center (aka the brain of AI) growth.
To put it in perspective, data center spend is still growing about 70%+ in the near term. PwC estimates annual growth between 2030 and 2050 will average 2.5%. That number feels too low. My best guess is that it probably approaches between 5–10% per year, as supported by PwC’s upside scenario of 6.5%. Those rates may look close on paper (2.5% vs. my midpoint of 7.5%), but they are not. Compounded over 20 years, 10% growth leaves annual spend about 4× what PwC’s midpoint is and about 2× their upside.Our Deepwater Frontier Tech ETF, $LOUP, is investing in some of these data center infrastructure companies that will aim to ride the growth of AI for decades.Source: Gene Munster