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AMD Ryzen 7000, HP HPE, Pure Storage Earnings, Poly Deal, Amazon Security PSA, Qualcomm IFA – The Six Five Webcast
by Daniel Newman | September 7, 2022

On this episode of The Six Five Webcast, leading global tech analysts Daniel Newman and Patrick Moorhead analyze the tech industry’s biggest news each and every week.

On this week’s show we will be talking:

  1. AMD Ryzen 7000 Desktop Launch
  2. HPE Earnings
  3. Amazon Security PSA
  4. HP Earnings, Poly Deal Closes
  5. Qualcomm IFA Announcements
  6. Pure Storage Earnings

For a deeper look into each topic, please click on the links above. Be sure to subscribe to The Six Five Webcast so you never miss an episode.

Watch the episode here:

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Disclaimer: The Six Five Webcast is for information and entertainment purposes only. Over the course of this webcast, we may talk about companies that are publicly traded and we may even reference that fact and their equity share price, but please do not take anything that we say as a recommendation about what you should do with your investment dollars. We are not investment advisors and we do not ask that you treat us as such.

Transcript:

Patrick Moorhead: Hi, this is Pat Moorhead with Moor Insights and Strategy and we are here for another Six Five Podcast. I’m here with my bestie Daniel Newman, and we are here doing what we love to do on these Friday mornings and that is give an analysis of what happened this week. Daniel, how are you?

Daniel Newman: Hey, good morning. Favorite time of the week. No matter what has come past, Friday mornings are those sacred moments of the week for us and hopefully for you out there, because a lot going on in tech, we’ve got a lot of great stories this week. In fact, we had too many stories because the Six Five, we’ve got to pick six. I’ll let you do the intro stuff, but too many stories, lots of earnings, lots of excitement and it’s almost the weekend, so there’s a whole bunch of really good things happening, and it’s a long weekend. At least for most people, at least here in the US.

Patrick Moorhead: Well, and I think I may have started early for some and I was walking to work today, downtown. I didn’t see too many cars going down, going on the Congress Bridge, and then I can also from my place see 35 and that didn’t look too busy either, so I think some people may be getting a jump on the weekend. I don’t know here, but-

Daniel Newman: We got on Lake Austin from your condo. Check it out, are there people out paddling and boating on Ladybird Lake, right?

Patrick Moorhead: No, it’s fun. I love it. I can watch other people exercising while I’m not, so it’s the perfect vantage point. We are the Six Five, 6 topics, five minutes plus each. I think we had eight topics. We had to narrow it down to six, but we’re talking AMD, HPE, Amazon, HP, Poly Peer and Qualcomm. A pretty good mixture of stuff. Some earnings, some announcements, some news, but hey, let’s jump right in here and I’m going to call my own number on this one.

Daniel Newman: Hey Pat, just real quick. You want me to do this disclaimer? I just want to know because we’re talking earnings, so let’s make sure we-

Patrick Moorhead: Sure. This show is for informational purposes only and probably some education too, but please don’t take anything we say as investment advice. All right, let’s jump right in. Daniel, we both attended the once stealth now public AMD Ryzen 7,000 launch in a great resort outside of Austin, about 20 minutes outside of the airport, and it was a ton of fun. If you haven’t been keeping score on AMD, it’s been doing super well in gaining market share in both client and server. In fact, I’m hearing AMD has 50% market share in the top CSPs and they are gaining, well that they have at least for the last couple years have done really well in the high end desktop, and that’s exactly what they refresh today. It’s the AMD Ryzen 7,000 product, and it’s what you would expect.

It’s funny a lot changes over 20 years, but a lot doesn’t, and this is more performance at lower wattage, and in fact, versus the 6K 49% more performance at the same power and 62% lower power at the same performance net-net for me. Again, look at the show notes, you can see all the gory details is their higher end price point was lower than I expected. Their lower price point was higher than I expected by about a hundred bucks. I think it’s very likely competitive with what’s upcoming from Intel for Raptor Lake, but there’s important stuff that I don’t know. The only reason I’m saying this is because Intel says that Raptor Lake is up to double digit performance compared to Alder Lake and I know how Alder Lake performs. With that said, I still think AMD will be competitive with Raptor Lake when it comes down to October, but a lot of details, I don’t know about Raptor. I don’t know power, I don’t know performance, I don’t know wattage on that, but I think enthusiasts are going to be pretty happy from what both Intel and AMD bring out.

One thing I want to point out is nothing that we saw so far on the 7,000 desktop will help AMD solve its enterprise share challenge. Typically the enterprises are not making decisions based on PPW, power, performance, wattage. They’re making it based on other types of things. It’s typically driven by the OEMs, but even if AMD provided 20% more performance for the same dollar, it doesn’t make these folks necessarily move. Intel also has somewhat of a moat with what’s called vPro and this is a special line of processors that Intel adopts its highest level of security and manageability on. AMD does have AMD pro, but enterprises have yet to, I would say, fully wrap their arms around it and actually ask for it like they do in bids with Intel vPro processors, but all around a great, great setting. It was great to see Lisa Su on stage, in person, rocking it.

Daniel Newman: It was great to be there Pat, at the redacted event, at the redacted location, hearing about the redacted products from a redacted company. That one time I almost tweeted out the name badge, so we were going to do the redacted tweet, but we were both wearing the lanyards and you caught me just as I was about to hit tweet, so that was good. See, that was maybe the highlight moment besides all the awesomeness that was released, so I’m a little newer to following the PC side. I track AMD much more closely on the enterprise and some of the things that they’re doing on the OEM, but what I would say is that it seems that the company’s got a couple of focal points and they’re focused very heavily on that low power, which isn’t only about competing with Intel, but it’s also going to be about competing with ARM, which is something I talk to them about, because ARM is certainly going to become more prevalent and there are certain OEMs that are leaning more and more on ARM based designs.

AMD has been pretty consistently grabbing market share from Intel over the last several quarters, and I like your bifurcation. A lot of it’s on consumer and that AMD’s desire to create a deeper moat into commercial. It wasn’t entirely evident that this launch is going to meet that particular requirement, and so that’s going to be something to watch. I think we’ve talked a little bit about vPro and AMD Pro as a whole, not totally certain that the adoption has been anywhere near as high as either company would like to see given the amount of investment that they’ve made to build capabilities that are very specifically designed to take care of those complex commercial needs in areas like security.

AMD’s been… Their story’s been really driven by performance and it’s been driven by a bit of a fan base of users that have become quite committed to the company’s story, it’s a bit of a sensational story in the market, and I think people have been very excited. Intel, unfortunately only had one direction to go over the last few years. They had so much market share that anything less than flawless was going to constantly cost. You and I talked about this in some of our different meetings at the event, grabbing market share from Intel has been at the disposal of AMD due to some different process delays, due to chip shortages, so the real question though, is I always like to talk about this with the market path, but is the growth on alpha? As Intel gets its stuff together, as some of its packaging and some of its process gets on time or closer to on time, will AMD be able to continue to grab market share because their product is notably superior or has it been because Intel couldn’t deliver? And we’ve seen of course how that’s been impacted on the server side.

But overall, like I said, as I’m starting to pay attention, it seems the low power, it seems security, and then of course you didn’t say much about this because we didn’t hear a ton. At least not the day I was there, but it seems the company’s really bent big on AI and they’re going to be more and more focused on AI, and so that’s going to be something I will certainly be watching, but it was an exciting launch. It was great, very intimate setting, Pat. A lot of handshakes and opportunities to speak to the executives, and you could sense a lot of enthusiasm. The culture of AMD is incredibly strong right now. You can’t really find anyone that’s working there that doesn’t seem excited and that’s a good time for a company.

Patrick Moorhead: There really is good ads on there. I’m wondering if AMD has already tapped its brand switcher markets so far, but hey, let’s move to the next topic here, which is HPE earnings.

Daniel Newman: I’ll link you up your tweet. I said this last week, follow Pat on Twitter, especially for his earnings tweets. You want to read the articles? Check out my blog, but if you want to read the best tweets in the business, Patrick Moorhead. You know what, Pat? I had a chance to talk to a Cisco CFO, Scott Herren yesterday, and I’m all I’m throwing this out is I actually really thought Dell, Cisco and HPE were in for a bit of a world of trouble this quarter. I was holding my breath, and actually they all came out pretty well, and so before I get into the kind of, “Hey, company did well, met expectations, guided well.” Let’s just say that you and I have talked on this show a number of times about the resiliency that commercial and enterprise business are going to have even in a downturn, and this to me was a macro reflection. The fact that Cisco, the fact that HPE, the fact that Dell, especially on the enterprise side, their case, even on the PC side, when we talk about HP, we’ll talk more about that, did pretty well.

Looking across the business, obviously you’re talking about single digits of growth. Still not necessarily anybody falling out of their chair, but over the last couple years, I’ve said in order to make a pivot from a CapEx intensive revenue model to an OpEx intensive revenue model, you’re often going to sacrifice top line growth to get that ARR in-house. The company had mid double digit ARR growth, it had strong everything as a service and GreenLake growth. Its GreenLake business is nearing a billion dollars in recurring. Company’s backlog is actually rising in the process of this and in some markets, I believe in HPC and in Edge, the company’s still performing pretty well on their traditional business. As you look at the whole company right now, it was a three year plan to move to everything as a service.

You talked to Antonio, so I’ll let you play in CEO whisper when I’m done here, but having listened to him over the last couple of years, this is a process, and so as I see it, if the company can meet its expectations consistently, grow the ARR, keep the various business lines in tap, innovate enough, and they really have in their GreenLake business they have, I think it’s safe to argue the most extensive portfolio of on-prem cloud services out of any of the companies in the market today. They’ve got the right product mix, they’re hitting their numbers, they’ve made that transformation that others are struggling to make quickly Pat, and overall, I think it was an encouraging quarter when we were, I think all holding our breaths for some pretty hard falls from some of the OEMs and consumer brands, but again, showing the strength that enterprises are still spending and having low exposure to consumer right now is good for business.

Patrick Moorhead: I had a great conversation with Antonio for earnings and what I was really struck with was his positivity. After hearing some vendors and the negativity, his positivity was really good. Now, part of that is not just chest beating, they have record backlog that’s 3X the historical backlog, and he really talked about this enduring demand. While I don’t think that necessarily translated to their monetary forecast, it was his attitude that I saw, and I really measure HPE as an industry analyst on two things, their growth businesses and on GreenLake, and both their growth businesses, intelligent edge and HPC and AI did grow low double digits in constant currency and GreenLake increased ARR by 22% and as a service 39%. Those are really good numbers, and while I do understand that’s not the entire business, there are elements of this industry that are getting a little bit more commoditized, like compute and storage.

I asked Antonio after watching what Dell did and subsequently we’ve seen what NetApp did, and we’ve seen what Pure Storage did on storage, like, “Hey, why is it only up 1% constant currency?” And he was flat out, it’s backlog. They have 5X the normal backlog in storage and even compute that they normally do. I don’t know exactly what’s happening from supply chain because I didn’t hear a ton about supply chain from a lot of the other vendors. We did hear a lot of backlog and supply chain from Cisco, but didn’t hear that necessarily from Lenovo or NetApp and even Pure. In fact, as we’ll talk about Pure, they talked about not really having a backlog, which I thought was interesting, but in the context of the future, having a big backlog going into troubled times, as long as it’s an enduring backlog, and it’s something that isn’t going to get pushed or evaporate, I think bodes well for the company.

There was initial bump up after hours, 2.5%, which translated, I think to about a 1.5% of boost, which in contrast a lot of these companies really got hammered after they had announced. I like the track that HPE is on, and it was great touching base with Antonio. Let’s move to the next topic.

Daniel Newman: Welcome back to the hosting gig.

Patrick Moorhead: No, no, I know. So funny I was waiting for you to like, “Well, what’s next, Daniel?” I appreciate that. Hey, let’s get into something a little bit different here. It’s not earnings and it’s not a product launch, but what it is something I think is very unique and that’s a public service announcement that is being done by Amazon. I had the chance to sit down and talk with Stephen Schmidt who owned security for all of Amazon, AWS devices, self-driving cars and as he put it, AWS boxes with smiley faces. I didn’t know there was security around the boxes, but I do now.

Amazon launched a PSA called Protect & Connect. It launched on August 22nd last week, and it really came out of a White House Security Summit that they had and I really appreciate Amazon stepping up. They’re doing videos that I think are really funny, breaking through the jargon of… You having to painfully sit with me on some of our advisory councils, I’m really talking about how you have to simplify security and maybe even have a security score against something, but it really drilled down into things like multifactor authentication, fishing, there are funny videos, vignettes. Amazon in fact, put this on their very top of their Amazon.com website to make it a little bit more interesting and the ability to pull people in it even pulled in Amazon Prime actor, Michael B. Jordan and actor and producer Tessa Thompson, who are these internet bodyguards that I thought was actually funny and not cheesy.

If you want to hit the show notes and check this out, I wrote a Forbes write up about this, but it’s really cool, and again, Danny, we talked this time and time again, Amazon, a lot of times gets viewed as the bad guy with the richest founder in the world, and sometimes we forget all the great things that the company does, like hire a ton of people, increase wages well above the minimum wage at levels that people say should be across the entire country. They do amazing things during COVID to help people out. In fact, they had really two rotten quarters gearing up to shift from having inventory of TVs, to things like food and stuff that you could buy that they normally didn’t have great lead times on so that people then wouldn’t have to go out and get in their car and potentially engage with themselves, walking into a store or not being able to do that. Good job, Amazon.

Daniel Newman: Amazon. With great power comes great responsibility and a company like Amazon, I think is making a very sensible decision and is using its clout and its visibility in a way that people should be happy. It’s not entirely selfless. Amazon is a company that has risk, they’re users being hacked. We saw what happened recently with the Okta and Twilio identity hack and what that can mean. We’ve seen it with a number of other hacks over the years. When consumer brands get hacked, it’s extraordinary

I think over the last few years, maybe we can use Apple as a little bit of a backdrop here. Apple put the lock in key into its marketing and it talked about things like privacy, but there is a growing attention to cybersecurity, and Pat, this is actually being validated by the market performance. If you look at where was the biggest growth area this quarter for Cisco? Security. If you look at Microsoft becoming the world’s largest security company, as part of its story. Companies, and by the way, this is probably one of the most robust and economically stable parts of any companies, because it doesn’t matter if the economy’s down, you got to protect data, you got to protect people, you got to protect information, and Amazon is a facilitator of the connected world. If you look at whether it’s AWS, if it’s Amazon in retail, if it’s Prime, this company benefits from making sure its users put more energy into securing themselves, their companies, their data, their accounts, et cetera.

PSA, no PSA, advertising campaign, branding, videos, tweets, whatever the powerful and influential companies the world can do to make people try to give at least one crap about their security, because people give no craps, the better. By the way, it’s costly, it’s tax on society. When companies or government agencies get hacked, when data gets leaked, it creates crime, and by the way, unlike and most people out there don’t seem to realize this, but when government spends money, someone has to pay for that. When we’re paying money to do anything, including deal with cyber-crime, deal with ransomware, this has a big cost, and by the way in the future, it probably will be the biggest economic cost of any black op in the world will be the continued and pervasiveness of cyber-crime. Thanks Amazon, you didn’t beat Apple to it, but maybe you’re doing it in a way that’s a little more pragmatic, can actually help people, because Apple did it merely under an onus of giving a crap about people, when we know.

Patrick Moorhead: Oh, it was amazing. Once they got that all locked in and did the cookie block, they opened up a huge advertising business.

Daniel Newman: Yeah. What’s the odds? Can you believe that? I can’t believe a company like Apple would do something like that.

Shocking, Pat.

Patrick Moorhead: Amazing. Hey, let’s move to the next, again, a different topic here. HP other earnings, and I think everybody’s celebrating that the Poly deal closed.

Daniel Newman: I was having so much fun though, because it was anytime I can run down the, beating Apple or the battering ram, by the way, I’m doing that while using multiple Apple devices that I pay for, so I feel like I have more of a right as a consumer to be angry and I think if people actually just admitted it. Chances are Amazon won’t get enough credit for this and Apple will never get proper credit for how…

Anyway, all right, going onwards, so HP, top line missed, bottom line hit. Last week when Dell reported it actually had a somewhat solid PC number, and so there’s a lot of conflictive information. Pat. Intel basically come out with its early numbers. Well actually TSMC came out really early with great numbers, then Intel came out and said, “Rapid deterioration of demand for PCs.” Then AMD came out and was like, “Ah, maybe not that rapid. It’s a little bit rapid.” And then Dell came out and were like, “Wow, that’s not bad.” But Dell also drew down quite a bit of backlog to hit that number and then guided down, so we’re like, “Okay, we’re starting to feel this way.” And then basically HP came in and said, “All right, hold my beer. We’re going to confirm what’s going on. The market for consumer’s slowing drastically and the market for commercial is slowing less drastically, but overall PC demand is down.” So on a year, over year basis, HP was down.

Having said that they did hit on their earning, so if you’re in this era of earnings are more important than revenue, then they did their job. Now it wasn’t all bad. HP did hit on their growth areas, their growth target areas, they’re still seeing double digit growth. They are still seeing some strength. I believe work stations are actually performing pretty well for the business right now, and of course, a number of the other areas like print are seeing a bit of a slow down. The numbers, Pat there wasn’t a ton in it other than like, “Hey, we’ve been saying consumers going to slow.” Now it’s being validated, and I think largely even on the companies that did better, all the signs are that we’re going to slow.

It’s just where we are on the curve of that slowdown right now, and so as much as I’d like to say, there’s a ton. You and I had the chance to hop on, we talked to Enrique, Laura CEO of HP, we got to ask him some questions. He actually validated my exact point right there. He said, “Commercial is sitting in a better position than consumer, but overall that this is what they are seeing today.” It looks like they guided down a bit as well, they had to pull back on guidance. Not necessarily a great earnings moment in this current state, but it is really pretty fair as to what everybody is seeing happening, so hopefully this is the reset for HP where they’re resetting, they’re guiding down a little bit and then they’re going to get back to starting to beat. Of course, they claim that there’s some general macro headwinds with interest rates and the consumer, and there’s also some delays still. We’ve seen a little loosening according to what Enrique shared with us, but it’s still not, supply chains still aren’t optimal.

The only thing is the company has been pretty aggressively doing dividends and stock repurchases, which probably to some extent has been impacting how it’s share prices stayed up throughout this whole thing, but again, we’re not equities guys, that’s just a little bit of an outside assessment, Pat. I’m going to turn it to you because this is the part I think is great is, the company did pull forward the acquisition and finalization of the deal to buy Poly, and so I won’t say too much because I’m going to give you the oxygen on this one, but I thought that was a really good deal for the company. Poly’s been in a bit of, it hasn’t seen rapid growth and I think with HP, the two together have a synergy to meet this remote and future of work expectation, and I think this is going to be a really good thing for the company.

Patrick Moorhead: The one thing I will comment on is on the earnings is that HP is losing market share in areas overall. Dell really stole the quarter, I think from everybody in terms of how it did, and again, I’m not, these are just using facts here. The client group at Dell was up 35% year on year, Lenovo was down and HP was down, so it’s clear that Dell gained market share and I think that HP has really been on this. I think Dell was balanced by very good financial, how they did financially and in the end, that’s really what matters, but I have to wonder how long can HP continue to lose market share? They’re very similar in unit market share to Dell right now, and Dell really doesn’t participate a whole lot on a unit basis in consumer, they really try to focus on the high end, so that’s what I’m going to be looking for as we go into the future here.

And I think printers are being printers and I’m not surprised in this odd hybrid work environment, how both of those businesses are down. On the Poly front, let’s talk about that. I love this acquisition and Daniel, I think I’ve told you this before, I recommended to every one of the big PC folks that they go and buy Poly. Why? First of all, we’re seeing this movement when it comes to this type of equipment from facilities to IT, and that’s because data is moving along with it, and these decisions are more and more being made by not the facilities folks who used to take care of rooms and their electronics to IT. Also Poly uses industry standard components like Qualcomm processors and Android operating system to achieve what they want to achieve, so I love this acquisition, I can’t wait to see what happens. I’m really glad to see Dave Scholl is going to be the president of that division, so good stuff.

Hey, let’s move on to Qualcomm and EFA, so EFA is Western Europe’s largest consumer electronics and appliance show, refrigerators, TVs, PCs, smart speakers, VR, all that good stuff. I got up at, let me see, I think I got up at three in the morning to watch Chris Gian win his keynote, no I really didn’t, but I did write it up though and I thought the announcements were super interesting. First of all, the company did a big announcement with Meta and Mr. Zuckerberg himself showed up virtually to congratulate everybody on the deal that has Qualcomm multi-year inside of Meta’s MR platforms, and I think this is a really big deal because quite frankly, if there’s going to be one or two companies that are going to win or take a big part of it, I think Meta is going to be one of them. I think Apple will do well, even though we haven’t seen any of their hardware yet, they’ve been working on their software for what seems like an eternity, and I think that’s a really big deal.

The other thing that I thought was interesting was that Meta has their own Silicon team, which you have to wonder, “Hey, what’s going to happen to that Silicon team now that there’s this multi-year deal?” I think Qualcomm is coming in to augment them. I don’t think we’re going to see some mass layoff there and by the way, Meta has a device called Portal and little mini versions of Portal that it has to create it or it could create Silicon for as well. The second one was Bose, very similar to a Samsung deal that we saw before, and like we saw with Meta is this multi-year deal to leverage Qualcomm’s audio solutions, particularly this S-five, Audio-SOC and its future, all of its future audio products.

Big picture, it really seems to me, my net-net and came out in my headline of my analysis is this is just yet another example of Qualcomm enabling OEMs to better compete with Apple, because if you think about it, everybody has to compete with apple on smartphones, on tablets, on PCs, on audio devices. In fact, Bose has lost a tremendous amount of market share to Apple, and one of the reasons is our criteria for audio equipment has changed. It’s less about how realistic something sounds and it’s more how well it can work with all your other devices and all the cloud music services that are out there. I think that’s just an overall big picture and I think reinforces also Qualcomm’s success in terms of getting out of, or not out of, but rising above its smartphone business into IoT and automotive. I’ll leave the final announcement for you Daniel.

Daniel Newman: Well, I’m trying to remember, so you did Meta, did Bose, did you do the satellite?

Patrick Moorhead: Didn’t do the satellite.

Daniel Newman: Okay. Well first of all, just let me quickly comment on the fact that the Meta one was the most exciting to me. Look, I understand the diversification strategy of Qualcomm, it’s migration into IoT and that becoming a multi-billion dollar annual business for the company has been huge in Iman’s strategy, Christian’s strategy to basically say, “Hey, we aren’t just a device company. We’re not just focused on handsets, and we’ve got revenue streams that are of significant magnitude that are outside of that particular area.” And so this space is a space that I don’t think many people necessarily think of Qualcomm first, but I think that’s the whole point. The company is more and more aggressively working, and so started with the peripherals, the smart watches and headsets and things that connected to the phone, and they’re moving more and more out to intelligent items that exist in an ecosystem, in a home or in a vehicle or et cetera, so that particular business is growing a lot. The Meta stuff, like I said, the metaverse, Meta. I’ll just call them Facebook.

Patrick Moorhead: I know, I still have a hard time with that, Daniel.

Daniel Newman: I liked them better as Facebook. I’ll call him bookface, but anyways, the metaverse, look I hear sarcastic comments. I think John Ford made a pretty big dig at the metaverse yesterday. Look, certain growth is out of vogue right now, nobody likes crypto. Nobody-

Patrick Moorhead: Until it is.

Daniel Newman: Nobody likes metaverse, every company’s going to zero, nothing is ever going to happen again and then in two years we’re going to have the same irrational exuberance back again. People aren’t going to care if you’re profitable, they’re only going to care if you grow, they’re only going to want the company’s doing the most cutting edge stuff. Well look, Meta, Mark’s made plenty of mistakes, but Meta will be a player in this space, and let’s not for a minute think that this is, company’s not going anywhere.

Qualcomm is going to be a critical partner because Qualcomm has the actual technologies, a little bit like NVIDIA does for Omniverse. Some of the key technologies that are going to be required for companies to actually build these metaverse experiences. As far as I see it, Qualcomm partnering with Meta, being a good partner is going to be a big deal for the company. I think the last announcement Pat, had to do with something that we’d already, I don’t think we talked about on the show, but I’m certain we’ve all socialized it, and that was the T-Mobile SpaceX announcement. That essentially, what was it? That T-Mobile, the smartphones are going to basically be able to connect to the SpaceX Starlink satellites. Now I’ll admit it, my knowledge of this topic came from reading your tweets. This is becoming problematic for me, Pat.

Patrick Moorhead: Wait a second, and you write articles on this stuff.

Daniel Newman: I do. I do. I do, but there’s been so much news in the last few weeks that I’ve had to keep up somewhat by using Patrick’s tweets. What is it effectively here? Well, somebody’s going to have to provide the smartphone modem that’s going to live behind these types of capabilities, and it looks like this could be something that Qualcomm is going to be providing, Pat. It sounds to me like Qualcomm is deepening its roots here being a provider, using its modem and RF systems to drive satellite communications, and so T-Mobile, Qualcomm, SpaceX, the future. I don’t know if there’s much more to this Pat, because I only saw a little bit of, I heard a little bit of background on it, but it sounds exciting. It sounds like maybe something that Qualcomm’s doing, this is V dot two of the old Qualcomm.

Now I’ll tell you a little story. My dad ran a trucking company in the ’90s and I used to go into work for him and I used to help him file his Qualcomm bills, because they were using satellite communications and Qualcomm hardware to keep truck drivers connected. This is the next generation we’re going to be connecting with astronauts and civilizations in space and it’s only been 30 years, so look how far we’ve come in a short period of time. I don’t know if I got all of that one Pat, because like I said, I only just read on it and that was the third one. Anything else I needed to get on that one?

Patrick Moorhead: No, I think we can expect next week during the Apple launch that Apple’s going to announce satellite communications and it’s going to be, this is only enabled on the Qualcomm modem RF system and also as it relates to the SpaceX and T-Mobile, the only modem RF that will do this is a Qualcomm combination.

Daniel Newman: Pat?

Patrick Moorhead: Yes sir.

Daniel Newman: Are you saying that Apple still uses Qualcomm?

Patrick Moorhead: Yeah they do. Yeah, they do imagine that. I’m hearing, by the way I heard this week that they’re having a really tough time integrating that modem into the SOC and it’s too high power and people are quitting. Imagine that.

Daniel Newman: Pat?

Patrick Moorhead: Yes, sir.

Daniel Newman: I’m asking another question. Is Apple going to soon be able to move to their own modem?

Patrick Moorhead: Listen, given enough time and resources, probably and they have more money than God.

Daniel Newman: Wait, do they have the resources to build this themselves, Pat?

Patrick Moorhead: Well, right now, no.

Daniel Newman: Yeah, but yet how much do they have in the bank?

Patrick Moorhead: I don’t know.

Daniel Newman: What is the market cap of Apple?

Patrick Moorhead: It’s over 2 trillion.

Daniel Newman: Okay. Maybe my Billy Madison moment here is over, but the moral of this story is this shit is hard.

Patrick Moorhead: Black magic dude.

Daniel Newman: Now we got to put the explicit thing on the show. I just said the S word, I’m sorry. This is a family show, but I just get tired of hearing how Qualcomm is going to get displaced and Apple’s going to build their own and it’s not going to happen. All right, Pat.

Patrick Moorhead: Hey, let’s move to the next. Let’s move this on.

Daniel Newman: Yeah. Super fast.

Patrick Moorhead: Pure rip it. Go

Daniel Newman: All right Pat. Well, you hit it on the head. That was the whole thing. 26% year on year growth, huge growth in customers. Their NPS story is world class, top 1% of companies in the marketplace. They’re seeing revenue growth. I’m sorry. Their guidance’s at 26%, their revenue growth at 30%, the subscription had over 30%. I don’t know what anyone’s talking about with the recession, but Pure Storage is absolutely rocking and rolling and their customers love using the technology. I know we’re on a really short period of time, so I’m going to just make one more comment and I’m going to pass it back to you, but this company is growing like hyper. It’s growing at the speed of Google Cloud, it’s growing at the speed of Azure, it’s growing at the speed of, twice as fast as Salesforce. It is an impressive growth rate right now for a company in boring, old storage, and so maybe storage is for boring when you put a new innovative spin on it. Great job Pure Storage, sorry we couldn’t talk more about it, but Pat has to go.

Patrick Moorhead: Pure, they saved the best infrastructure result for last. The 30% growth rates are cloud growth rates, which is obscene and amazing, and I loved what they put in there. As everybody’s talking about backlogs and lead times, normal lead times, that was a thumb to the nose of the NetApps and the Dells of the world, so great job. We’re going to take us out of here, Daniel it was great to see you. Everybody have a great weekend, we appreciate you.

Daniel Newman: Going to be on TV later?

Patrick Moorhead: I am. I’m going to be on Fox Business, chatting up SaaS company, so wish me luck.

Daniel Newman: All right, buddy. Go get it.

Patrick Moorhead: I’ll take it easy.

Daniel Newman: Everybody watch.

Patrick Moorhead: Thanks for tuning in, and if you like what you heard hit that subscribe button. If you didn’t complain to Daniel on Twitter, we’re out of here.

About the Author

Daniel Newman is the Principal Analyst of Futurum Research and the CEO of Broadsuite Media Group. Living his life at the intersection of people and technology, Daniel works with the world’s largest technology brands exploring Digital Transformation and how it is influencing the enterprise. Read Full Bio