Here are the top-line numbers from Apple’s fourth quarter, which represents its July through September performance:

Revenues: $94.90 billion, a 6% increase from $89.5 billion in 2023. Apple’s Q4 sales topped analyst estimates from Zack’s Investment Research of $94.56 billion.

Net income: $14.74 billion in net income, down 35.9% from last year when the company reported a $23 billion profit.

Earnings Per Share: Apple’s diluted earnings per share of $0.97 were lower than Zack’s estimates of $1.49.

Services Net Sales: Apple’s Services revenue was $24.97 billion, up 12%, and now makes up more than a quarter of the device maker’s overall revenues.

The bulk of Apple’s sales, as usual, stemmed from its products, with nearly $70 billion coming from that sector. Apple’s iPhone sales increased 5.5% year-over-year to $46.22 billion in Q4, despite sluggish sales in the U.S. and China.

Most of Apple’s sales growth stemmed from its European markets, which brought in $2.5 billion more than it did last year, when Q4 sales were $22.46 billion. It’s a tricky market to gauge, though, considering Apple includes sales from India and the Middle East in its European bracket.

During the quarter, Apple paid a one-time income tax charge of $10.2 billion in order to resolve the tax issue with Ireland, which dates to 2016. Excluding the tax hit, Apple’s profit was $25 billion.

Apple CEO Tim Cook, on the company’s earnings call on Wednesday, said it was the company’s best quarter ever in terms of Services growth year-over-year. Cook, as has been the practice with the tech company, didn’t mention how much Apple TV+ contributed to its big Services quarter.

“We have well over 1 billion paid subscriptions across the services on our platform,” Apple CFO Luca Maestri said on the company’s earnings call, “more than double the number we had only four years ago.”

Maestri, in the company’s earnings statement, added the company’s “active installed base of devices reached a new all-time high across all products and all geographic segments.”

AI was a major topic on the earnings call, with analysts asking several questions about Apple’s plans to compete in the increasingly crowded space. Maestri said Apple had already reallocated some “existing resources” to its AI team, and that the “level of intensity that we’re putting into AI has increased a lot.”

Maestri added the company was able to return over $29 billion to shareholders via dividends during the quarter. Wednesday’s earnings call is the last time Apple investors and analysts will hear Maestri talk publicly about the company’s performance, after he announced in August he’d be stepping down in early 2025, following a decade as CFO.

Apple’s stock, about 30 minutes after the company’s Q4 report was released, was down 1% in after hours trading to $225.91 per share.

In August, Apple changed the release strategy for “Wolfs,” its new action-comedy flick starring Brad Pitt and George Clooney, with the movie shifting to a limited release on Sep. 20 before hitting Apple TV+ exclusively a week later on Sep. 27. TheWrap reviewed the movie, which already has a greenlit sequel.

Apple didn’t have much of anything to say about its content business on Thursday, beyond mentioning series like “Shrinking” had recently returned.

On the AI front, Apple was in talks to invest in OpenAI in August, but that ultimately didn’t come to fruition. OpenAI later announced it had raised $6.6 billion in October, in a round led by Thrive Capital that also included Nvidia, Microsoft, Fidelity, and SoftBank, among other investors.

Apple Intelligence, the company’s suite of AI tools that, among other things, summarizes notifications and allows users to remove objects from pictures, launched earlier this week on iPhone, iPad, and Mac.

On the company’s call on Wednesday, Cook said Apple Intelligence will be “rolling out” more features “in the coming months.” The October through December quarter, Cook added, will be “quite a software quarter” for Apple’s AI business.

With the 2024 election looming, Cook was asked by an analyst what Apple planned to do if tariffs changed. Republican nominee Donald Trump, who has proposed a 60% tariff on goods from China and a 20% tariff on everything else, has touted his tariffs proposals at rallies and on “The Joe Rogan Experience.” Cook said he “wouldn’t want to speculate about those sorts of things.”

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The database, called Attend, was developed alongside movie theater technology company Vista Group and will be launched as a pilot program in the United States and Australia in early 2025. The database will allow filmmakers to upload information and materials, including trailers, about their films onto the database for theater owners to view.

Exhibitors can search the database, while Attend also recommends movies to exhibitors based on the preferences of their individual theaters and moviegoers. The platform also can assist exhibitors and filmmakers in the logistics of the self-distribution process.

The program has drawn the support of dozens of directors and producers, including Steven Soderbergh, Damien Chazelle, Patty Jenkins, and the producing duo of Dede Gardner and Jeremy Kleiner, who co-founded the company Plan B with Brad Pitt.

“The Attend digital marketplace is designed to grow the annual theatrical release slate by featuring mid-range movies that have disappeared from cinemas, international movies seeking domestic releases, and movies that typically receive limited theatrical release but could gain broader audiences through data-driven theatre selection, scheduling and marketing,” the Fithian Group said in a Wednesday statement.

This new platform comes as more theater owners are considering direct deals with filmmakers in the wake of last year’s landmark deal between AMC and Taylor Swift on the pop star’s concert film “The Eras Tour,” which made $250 million worldwide without the marketing or distribution aid of a major Hollywood studio.

While few films, if any, will ever reach those levels, the success of the movie has raised interest among exhibitors who have spent the past few years weathering long droughts in theatrical output from Hollywood studios due to production logjams caused by the COVID-19 pandemic and last year’s strikes.

“Between 2017-19 and 2022-23, the number of movies released fell by 26%. In these comparable time periods, the number of non-studio movies grossing $400K+ fell by 29%. This reduction contributed to a 38% decline in revenue and 47% admissions in this segment,” the Fithian Group noted.

While that output is expected to significantly increase in 2025, self-distribution is now being seen as a more viable option for directors struggling to find acquisition interest as Hollywood tightens its spending or to stand out on the increasingly competitive festival circuit.

As TheWrap reported earlier this year, several films such as the indie cult hit “Hundreds of Beavers,” have pursued the self-distribution route, with more exhibitors considering such films for weekday evening screenings in lieu of holdover titles from major studios that were released several weeks prior. Some filmmakers, such as the “Beavers” team, have collaborated with exhibitors on getting the word out with targeted digital marketing ads, post-screening Q&As, and providing theaters with marketing material that it can send directly to their customers through mailing lists, social media and loyalty programs.

“Attend expands possibilities for filmmakers and non-studio movies to reach audiences and to expand the reach and efficiency of existing distributors. Over many years of grappling with the challenges and opportunities facing the theatrical market worldwide, as industry leaders we have sought solutions that grow the business for all stakeholders.” said Brenneman. “With their leading technology, Vista Group’s support will help create new opportunities for filmmakers, exhibitors and audiences that might not otherwise exist.”

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“We had a good quarter driven by AI progress across our apps and business,” Meta CEO Mark Zuckerberg said in a statement.

Zuckerberg, on the company’s earnings call on Wednesday afternoon, said 500 million users are now interacting with Meta’s AI chatbot, which offers answers to users on apps like Facebook and Instagram. He also said the company would continue to invest in the long-term future potential of AI, AR (augmented reality) and VR (virtual reality), despite growing concerns from investors over mounting losses at Meta’s Reality Labs division, which has booked losses of $24.2 billion over 2023 and 2024.

Here are the top-line results: 

Revenues: $40.59 billion, up 19% from $34.15 billion in 2023. Meta’s Q3 sales topped analysts from Zack’s Investment Research estimated revenues of $40.21 billion. The company’s quarter-over-quarter revenue growth slowed from Q2, when the company reported a 22% annual jump in sales. As usual, the bulk of Meta’s sales — 96% — came from ads.

Net income: $15.68 billion, an increase of 35% compared to $11.58 billion the year prior. Meta’s diluted earnings per share of $6.03 beat Zack’s estimate EPS of $5.19. The company’s Q3 profit topped its previous record for quarterly net income, which it set during the fourth quarter of last year when it posted a $14 billion profit.

Daily active users: 3.29 billion DAUs across its family of apps — Facebook, Instagram, WhatsApp, and Threads — by the end of September, up 5% year-over-year. Meta added 30 million daily users quarter-over-quarter, although the company didn’t share how those gains broke down by app.

Threads: Zuckerberg said that Threads, the company’s social app that launched as a rival to X last year, now has 275 million monthly users. That’s up 37.5% from Q2, when the company said Threads was approaching 200 million monthly users. CFO Susan Li, on the company’s earnings call, said Threads has seen healthy growth in the U.S. and overseas markets including Taiwan. At the same time, Li said, “We don’t expect Threads to be a meaningful driver of 2025 revenue.”

Average price per ad: The average price of an ad on one of Meta’s apps increased 11% year-over-year, indicating the appetite for reaching users on Facebook and Instagram remains strong.

Head count: Meta reported 72,404 employees at the end of September, up 9% from the prior year. Meta’s growth stands out, as many tech companies, including TikTok, have cut jobs in recent months.

Guidance: Meta said it expects to report between $45 billion and $48 billion in sales next quarter.

Mounting Reality Labs losses

Facebook Reality Labs, the company’s unit dedicated to virtual and augmented reality hardware and software, continued to stick out like a sore thumb on Meta’s earnings report due to its losses. FRL’s operating loss was $4.4 billion for Q3, up 19% from the year prior. In the first nine months of 2024, Meta has lost $12.76 billion on FRL, which is currently developing its Orion AR-powered smart glasses.

Zuckerberg is bullish on the future of smart glasses, saying last month they’ll “gradually replace phones by 2030.” And Meta appears unfazed by FRL’s mounting losses.

The company expects “operating losses to increase meaningfully year-over-year due to our ongoing product development efforts and investments to further scale our ecosystem,” Li on Wednesday.

Zuckerberg added it was important for the company to continue investing in AI, AR, and VR, even if that’s not “what investors want to hear in the near-term” as losses grow. “The opportunities here are really big,” Zuckerberg said.

The company’s stock, which has been red hot in 2024, took a momentary breather after Meta’s Q3 report posted. Shares dropped 1.5% in early after-hours trading to $583 per share. On the year, Meta’s stock is up 70%.

Meta has continued its push into artificial intelligence in recent months, as the company battles Alphabet, Apple, and Microsoft, as well as Microsoft-backed OpenAI in the budding sector. Last month, Meta announced its AI chatbot would be voiced by Hollywood stars like Kristen Bell and Keegan-Michael Key. And last week, Meta struck a multi-year deal with Reuters to include the news organization’s content in responses from its AI chatbot.

In an effort to reduce its dependence on Google and Bing, Meta is also working to build its own AI-powered search engine, that would drive its chatbot’s responses.

When it comes to another hot topic — politics — Meta has been conspicuously quiet during the run up to Election Day. In 2020, the company — after facing backlash for Russian bots being able to run ads during the 2016 presidential race — tightly policed COVID-19 and election news on its platform. Most notably, Facebook took steps to limit the distribution of a New York Post report on Hunter Biden, the son of then-nominee Joe Biden, in October 2020.

This year, Meta has opted to deemphasize political content on its platforms, at the behest of Zuckerberg. Instead, Meta’s apps are now more likely to recommend sports, cooking and celebrity news to users.

On the Instagram front, Meta announced last month it would start applying restrictions to kids’ accounts in an effort to make the app more “safe,” in the company’s words.

Looking ahead, Zuckerberg said he was “pretty amped” about the work Meta is doing on the AI and AR/VR front.

“This may be the most dynamic moment that I’ve seen in our industry,” Zuckerberg said on the Q3 call. “And I am focused on making sure that we build some awesome things and make the most of the opportunities ahead.”

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“Top 10 Today,” which can be found on the Disney+ homepage, provides subscribers with popular movies and television shows on the platform, and its purpose is to assist viewers with finding the next title or episode they’d like to watch. The new feature will not be available to Junior Mode profiles.

Each lineup of shows and films will differ from person to person and will be curated based on a variety of details, including the profile’s content rating, the subscription plan (Bundle subscribers will see Hulu on Disney+ titles) and location — lists will be determined by the country a person is from as title availabilities vary by specific markets.

“The Top 10 Today set takes several factors into account, including total views at the episode and movie level within a day and the growing popularity of new titles released during that time frame. Views are a component of the Top 10 Today formula but it’s not the sole determining factor,” Disney+ said in a statement.

Subscribers will notice the collection set on their home screens starting Wednesday.

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The Los Angeles-based company’s stock hit $12.54 per share about two hours into trading on Wednesday. Snap’s increase is a welcome sight for longterm shareholders, considering the stock is still down about 22% since the start of 2024.

Snap’s big morning comes a day after it reported adding 11 million daily users during the third quarter, pushing Snapchat to 443 million daily users overall. Analysts had expected the company to report about 441 million daily users, per Yahoo Finance. Third quarter revenue of $1.37 billion, meanwhile, edged past what analysts were looking for.

And perhaps most notably, Snap announced a $500 million stock repurchase program. The company, following Wednesday morning’s stock increase, is worth $20.8 billion.

Snap, similar to how Alphabet on Wednesday credited artificial intelligence with driving better YouTube recommendations in Q3, also gave a shoutout to AI in its earnings report.

“Our investments in AI and AR are powering new creative experiences for our community and driving innovation across our advertising platform, underpinning our longterm growth opportunity.” CEO Evan Spiegel said in a statement.

The company said Snapchat+, its $3.99 per month subscription service that offers exclusive features, is up to 12 million users; in August, the company had reported 11 million paying subscribers.

Meta, the parent company of rival Instagram, is set to report its own Q3 earnings on Wednesday afternoon.

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Here are the key takeaways:

Revenue: Grew 12.1% year-over-year to $8.92 billion. It was the second straight quarter in which YouTube’s year-over-year increase declined, after revenues rose 20% year-over-year in Q1 and 13% last quarter.

Historical Comparison: YouTube’s best quarter in terms of sales came during Q4 2023, when the platform reported $9.2 billion in ad revenue.

The Last 12 Months: Alphabet noted YouTube’s total ads and subscription revenues surpassed $50 billion over the past four quarter for the first time.

YouTube Viewership: The company’s earnings release didn’t include an update on how many people watch YouTube. On the company’s earnings call, Alphabet CFO Anat Ashkenazi said YouTube had enjoyed “robust growth in watch time across the platform,” without offering further details. Chief Business Officer Philipp Schindler added YouTube’s Q3 ad growth was “driven by brand, closely followed by direct response.”

Subscriptions: Google subscription revenue — which includes YouTube TV, Premium, Music, and NFL Sunday Ticket — climbed 27.7% year-over-year to $10.66 billion. Pichai said “YouTube TV, NFL Sunday Ticket, and YouTube Music are driving subscription growth” on the company’s call, but didn’t offer further details on how each is performing.

Artificial Intelligence: Once again, AI was a fixture of Alphabet’s earnings report and call. As for Youtube, Schindler said the company is using AI to “greatly improve” YouTube recommendations.

“Driven by Gemini, our large language models have a deeper understanding of video content and viewer preferences. As a result, they can recommend more relevant, fresher and personalized content to the viewer,” Schindler said.

The tech giant’s overall sales increased 15% year-over-year to $88.3 billion. Google Services — which includes subscriptions, platforms, devices, and YouTube ads — accounted for the bulk of Alphabet’s sales, increasing 13% to $76.5 billion.

Alphabet’s shares closed 1.66% higher on Tuesday to $171.14 per share, and were up more than 5.5% in after-hours trading. Heading into its Q3 report, Alphabet’s stock is up 22.6% on the year.

YouTube remains the go-to destination for viewers looking for videos on a myriad of subjects, from kids content to football news to 2024 election coverage. A recent Pew survey found nearly one-third (32%) of Americans regularly get their news from YouTube, up from 23% in 2020.

But YouTube faces stiff competition for viewers from Netflix, which recently reported it added another 5 million subscribers and has 282.7 million customers overall.

Still, YouTube continues to lead the streaming pack in terms of viewership, with the platform accounting for 10.6% of all TV streaming in September, according to Nielsen’s Gauge report. Netflix accounted for 7.9% of TV streaming, and Prime Video, the third-ranked platform, accounted for 3.6%, according to Nielsen.

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As part of the contract with Ethovox, which was founded by video game voice actor Cissy Jones, SAG-AFTRA members who lend their voices to the development of the model will receive both session fees and ongoing revenue sharing for the life of the foundational model.

In addition, no single actor will have their voice recognizably replicated by the model, as it requires volumes of voice samples to build a foundation.

The Ethovox model will not be user-facing, and the voices included in the model will not be identifiable in any of the speech generated. 

“Ethovox is the only voice AI company owned and managed by voice actors, and we are pleased to be partnering with SAG-AFTRA on building a foundational voice AI model that prioritizes the interests of voice actors,” Jones said in a statement. “AI should be a choice. For that reason, we have reached out to the voice actor community throughout this process. Ethovox will continue to do so as we demonstrate that artists can, and should, be compensated for contributing to ethical AI development while also maintaining consent and control over their voice data.”

The Ethovox deal joins those made by SAG-AFTRA with other AI companies, including Narrativ, which will allow members to license their digital voice replica for use in audio ads, and video game voice company Replica Studios.

While the deals have been met with some pushback from SAG-AFTRA members who see any use of AI as a threat to their livelihoods, national executive director Duncan Crabtree-Ireland has stressed the importance of building a standard of ethical AI use to counter exploitation of actors’ performance and likenesses without their consent or compensation.

“What will safeguard voice actors’ livelihoods in the AI age is more contractual protection, not less,” Crabtree-Ireland said. “That’s why SAG-AFTRA will continue to recognize AI companies, like Ethovox, that agree with our union’s AI guidelines. Not everyone will want to work with an AI company, and that’s understandable. But for those who intend to utilize the opportunities AI offers, it’s important that agreements require companies to secure informed consent and provide fair compensation. Without informed consent and fair compensation, this new era will become a ‘Wild West’ of AI misuse and exploitation.”

Meanwhile, SAG-AFTRA is scheduling a new round of negotiations with video game companies signed to the Interactive Media Agreement, looking to reach a deal after going on strike this past July over what the union says are inadequate proposed AI protections.

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The company’s search engine will crawl “the web to provide conversational answers about current events to people using its Meta AI chatbot,” according to the report.

Meta’s AI chatbot is built into the search and messaging features on its apps, which include Facebook, Instagram, WhatsApp and Messenger. The chatbot currently displays search results from Google and Bing as part of its answers. Altogether, Meta’s apps have 3.27 billion users.

Monday’s news follows last week’s announcement that Meta had signed a deal with Reuters to include the news organization’s content in its AI responses.

The Reuters deal also came after CEO Mark Zuckerberg said he believed his company would strike “certain partnerships” to bolster its AI responses, but that “individual creators or publishers tend to overestimate the value” of their content.

“My guess is that there are going to be certain partnerships that get made when content is really important and valuable,” Zuckerberg told The Verge.

Moving forward, Meta’s AI chatbot will cite Reuters’ stories in its answers, as well as provide links to the outlet’s content. Reuters will be compensated for its reports, a source told Axios.

Meta’s stock is up 1% on Monday morning to $579.21 per share. The company has been on a big run in 2024, with Meta’s shares increasing 67% since the start of the year. Meta is set to report its Q3 earnings on Wednesday afternoon.

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In the meantime, the guild’s strike against all Interactive Media Agreement signatory companies remains in effect.

“After three days of scheduled negotiations, SAG-AFTRA announced that Interactive Media Agreement negotiations with employers would continue, with new dates to be announced as soon as they are confirmed,” the guild said in a statement Saturday morning.

The two sides resumed talks on Oct. 23, almost exactly three months after the strike began. Among the participating video game companies are Activision Productions Inc., Blindlight LLC, Disney Character Voices Inc., Electronic Arts Productions Inc., Formosa Interactive LLC, Insomniac Games Inc., Llama Productions LLC, Take 2 Productions Inc., and WB Games Inc. on Oct. 23.

When the strike was declared in July, performers had been working on video games without a contract since November 2022. SAG-AFTRA said that while most issues were settled, negotiations broke down over protecting voice and motion capture performers from exploitation by so-called artificial intelligence.

The day the strike went into effect, Negotiating Committee chair Sarah Elmaleh and Interactive Agreement lead negotiator Ray Rodriguez explained that among other things, video game industry counteroffers were designed with loopholes big enough to effectively neutralize any agreed-upon protections.

Among them, motion capture performances would only be protected if a video game character actually resembled the actor — which would exclude the majority of video game mo-cap. And voice actors would only be protected if their characters’ voices sounded recognizably like their own.

In addition to closing those loopholes, SAG-AFTRA wants consent and compensation guaranteed for performers for any use of their work in any AI models for video games.

Naturally video game companies dispute this, saying at the time the strike was declared that they were “disappointed the union has chosen to walk away when we are so close to a deal, and we remain prepared to resume negotiations.”

Meanwhile, earlier this week SAG-AFTRA announced that more than 120 games created by 49 different companies had signed on the tiered-budget or interim agreements the union has offered since the strike began.

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OpenAI’s finances are as bizarre as you might expect. It’s paying hundreds of millions to Microsoft before making a profit, it’s projecting many billions in losses in the coming years (far more than it’s raised), and it’s putting forth some wild economic ideas including removing training costs from profit calculations.

Here are four revealing truths from OpenAI’s financial presentation, with some analysis of what they mean for the company and the broader AI industry:

1. OpenAI thinks its training costs might shift in a big way 

OpenAI told investors its training costs weren’t fixed, and it could ramp them up and down in the future. This contributed to a novel view of profitability. “OpenAI is emphasizing to investors a metric of profitability that excludes some major expenses, such as the billions it is spending annually on training its large language models” The Information reported.

OpenAI is spending approximately $3 billion on training this year, so excluding training from profitability seems like fuzzy math. But consider the way the company’s latest o1 model operates: It’s a reasoning model that does much of its processing after the prompt, transferring some of the traditional training load to inference. Training costs, therefore, might be fairly unpredictable in the long term. And you might want to account for that in your projections.

OpenAI will continue to develop larger foundational models, though, which requires spending plenty of dollars on training. And any notion that GPT-6 will be its ‘final model’ due to resource constraints isn’t right. Looking forward, different techniques might slim down OpenAI’s training costs, but it’s hard to see these minimized to the point they go away. Still, the funny math is an interesting signal.

2. OpenAI thinks ChatGPT will make more money than its API

Experts have long held that OpenAI’s technology would be most valuable in the hands of developers, with ChatGPT serving mostly as a demo. But OpenAI’s projections show the opposite. The company is expecting ChatGPT to bring in the lions’ share of its revenue until at least 2029. 

OpenAI’s massive expectations for ChatGPT might suggest that building large GenAI foundation models is growing commoditized, with open source efforts like Meta’s Llama serving as sufficient substitutes for OpenAI’s GPT. But the documents underscore just how much momentum OpenAI believes it has with ChatGPT. The chatbot now comes in various flavors — including consumer, enterprise, team, and edu — giving it plenty of room to expand.

That said, OpenAI is counting people’s interest in chatting and speaking with AI bots to grow considerably over time. It may happen, but the user interface is still unproven. And if ChatGPT adoption doesn’t grow according to plan, OpenAI could have a revenue problem.

3. OpenAI is already paying Microsoft lots of money

Microsoft’s invested nearly $14 billion in OpenAI, entitling it to 49% of the company’s profits after some initial investors get paid back. But surprisingly, OpenAI is already paying Microsoft a large sum of money before turning a profit. In the documents, OpenAI projected a $700 million payout to Microsoft in 2024, a large portion of its $4 billion total revenue. 

After Microsoft’s $700 million payout, and $3 billion in training costs, OpenAI would just squeak out a profit in 2024. But add in $2 billion for inference, $700 million for salaries, $500 million for data, and various other costs, and OpenAI is projecting a $5 billion loss this year. The AI business is expensive, and OpenAI’s responsibilities to Microsoft make it even more costly.

4. OpenAI will have to raise again (soon)

OpenAI raised $6.6 billion this month, the largest venture capital round in history. But it plans to lose $5 billion this year alone. And by 2026, it could be losing $14 billion per year. That’s head exploding territory. If OpenAI keeps burning money at this rate, it will have to raise another round soon. Perhaps as early as 2025. And when that moment comes, we’ll learn how sustainable OpenAI business is, and what type of investors (if any) will have the stomach for such significant, repeated investment. 

This article is from Big Technology, a newsletter by Alex Kantrowitz.

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