Netflix Drops Out of Running for Warner Bros. Discovery, Apple Signs F1 Deal With Netflix, Apple’s F1 Integration Is Unprecedented, Apple’s Busy (Upcoming) Week
February 27th, 2026
By Neil Cybart
Netflix Drops Out of Running for Warner Bros. Discovery
Apple Signs F1 Deal With Netflix
Apple’s F1 Integration Is Unprecedented
Apple’s Busy (Upcoming) Week
Hello everyone. We wrap up this week with a few stories in video streaming land. The discussion will then turn to Apple’s busy upcoming week.
Netflix Drops Out of Running for Warner Bros. Discovery
The Warner acquisition outcome that had the best odds of occurring from the beginning is once again back on top. Netflix refused to increase its Warner bid to match Paramount’s improved bid. Barring any sudden developments, Paramount will acquire Warner Bros. Discovery. The deal remains subject to regulatory approval. While someone may try to block the deal on antitrust grounds, that will be a tough hill to climb.
In some ways, this was the inevitable conclusion as Netflix was always going to have a difficult time countering two things:
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Apple to Bring Some Mac Mini Assembly to the U.S., Apple Gives WSJ Factory Tour, NYT Pushes U.S. Semiconductor Propaganda
Hello everyone. A quick update on where the schedule stands. The blizzard in Connecticut earlier this week and subsequent snow yesterday threw another winter wrench into update publication timing. The plan is to have an update out tomorrow that essentially will combine two updates into one.
Let’s jump into today’s update.
Apple to Bring Some Mac Mini Assembly to the U.S.
In a press release issued on Tuesday, here’s Apple:
“Apple today announced a significant expansion of factory operations in Houston, bringing the future production of Mac mini to the U.S. for the first time. The company will also expand advanced AI server manufacturing at the factory and provide hands-on training at its new Advanced Manufacturing Center beginning later this year. Altogether, Apple’s Houston operations will create thousands of jobs.
‘Apple is deeply committed to the future of American manufacturing, and we’re proud to significantly expand our footprint in Houston with the production of Mac mini starting later this year,’ said Tim Cook, Apple’s CEO. ‘We began shipping advanced AI servers from Houston ahead of schedule, and we’re excited to accelerate that work even further.’
For more than two decades, users around the world have relied on the incredibly popular Mac mini for the tremendous power it packs into its ultra-compact design. With its next-level AI capabilities, it has become an essential tool for everyone from students and aspiring creatives to small business owners. Beginning later this year, Mac mini will be produced at a new factory on Apple’s Houston manufacturing site, doubling the campus’s footprint.”
Apple COO Sabih Khan announced this Mac mini news while giving the WSJ a tour of U.S. partner facilities (more on the tour shortly). Interestingly, Khan said that “thousands” of Mac mini units are assembled “every week.” The wording points to a Mac mini annual production rate ranging from
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Apple Partners With IMAX for F1, MLS and Apple Kick Off New Season, Apple Partners With EverPass Media
Hello everyone. What a winter we are having here in Connecticut. We can now add a blizzard to the mix. Monday's snowfall totaled 15 inches which was a little bit less than the 17 inches from just a weeks ago. It still led to a crazy Monday.
Today's update will have an Apple sports theme as we kick things off with F1 news and then turn to MLS.
Apple Partners With IMAX for F1
Here’s Motorsport:
“IMAX has announced that a select number of races will be shown live in IMAX locations across the United States in 2026.
The new fan viewing experience is part of a collaboration with Apple TV, which has taken over the broadcasting rights for the championship in the US on a multi-year deal from 2026.
‘F1 is a rapidly growing force in sports and culture in the US, and by bringing F1 on Apple TV live to IMAX theatres nationwide, we’re delivering the energy and excitement to even more screens in a truly immersive way,’ said Oliver Schusser, Apple’s vice president of music, sports, and Beats.
'We’re excited to collaborate with IMAX to expand access to F1 on Apple TV and give fans across the U.S. a powerful new way to experience the speed and spectacle that the sport delivers.’"
Details remain on the light side. For example, ticket pricing was not given. Five grands prix will be shown with distribution that will exceed at least 50 U.S. IMAX theaters. Since IMAX has 380 U.S. theaters, we can probably assume distribution will be more than 50 theaters.
It’s good that Apple is willing to think outside the box with F1 distribution. What is the point of Apple getting its hands on F1 distribution rights if the plan is just to do what other distributors have done?
Some of the business calculation at play with this IMAX partnership may be that F1 and IMAX will
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Apple Releases iOS 26 Adoption Figures, iOS 26 Adoption by iPhone Age, YouTube Launches Apple Vision Pro App (Finally)
Happy Friday. We will jump right into today’s update.
Apple Releases iOS 26 Adoption Figures
Last month, a fair number of Apple bloggers and writers got punked by faulty analytical data from StatCounter that showed few iPhone users had upgraded to iOS 26. Prior to the mistake being caught, the bad data led to a wave of articles infused with FUD (fear, uncertainty, and doubt). One publication’s takeaway was that iPhone users were “showing a level of hesitation toward iOS 26 that has not been seen in recent years.”
Based on new App Store disclosure from Apple, iOS 26 adoption is trending roughly in-line with adoption behavior seen in prior years.
As of February 12th:
iOS 26: Installed on 66% of devices.
iOS 18: 24% of devices.
Earlier than iOS 18: 10% of devices.
For new iPhones (released within the past four years), iOS 26 adoption jumps to 74% with iOS 18 representing another 20% of devices.
Circling back to what Apple reported in prior years:
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Spotify Earnings, Something Feels off With Spotify, It's Time to Push Apple Music
Hello everyone. The initial plan was to have this update cover Spotify’s earnings along with a few other news items. However, in going through Spotify’s earnings call transcript, it quickly became apparent that a different discussion was needed. We will have that discussion today. This will free up some space in tomorrow’s update to pursue a few other topics.
Let’s jump in.
Spotify Earnings
Looking back over the past two to three years of Above Avalon Daily Spotify earnings reviews, the prevailing takeaway from our discussions was spectacular user growth offset by mediocre financials.
(As for how Spotify has been able to grow its subscriber base, we can’t underestimate the power of free, unmet demand in emerging markets, and family plan accounting.)
Spotify’s 4Q25 numbers were
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Apple News Bias Alleged, FTC Warns Tim Cook, EssilorLuxottica Discloses Ray-Ban Meta Sales
February 13th, 2026
By Neil Cybart
Apple News Bias Alleged
FTC Warns Tim Cook
EssilorLuxottica Discloses Ray-Ban Meta Sales
Hello everyone. Let’s jump into today’s update.
Apple News Bias Alleged
Last week, MRC, a partisan website, alleged that Apple News was taking a “defiant stance against offering news from right-leaning outlets….” The website went on to cherry-pick a few headlines from what hundreds of stories curated within Apple News to say that Apple was purposely “rejecting” only “right-leaning outlets.”
Not surprisingly, the article was picked up by outlets including the New York Post and Fox News, two of the publications mentioned in MRC’s article as allegedly receiving unfair treatment from Apple. Due to the exposure generated by the outlets, the MRC report was eventually highlighted by President Trump, Elon Musk, and others on social media. Within a day, the FTC had sent a threatening letter to Tim Cook regarding the alleged Apple News bias.
AllSides, a publication that labels news sites based on their perceived political leaning, pushed out its own article based on Apple News data that they collected in October. Here’s AllSides:
“A new AllSides bias analysis found Apple News (Lean Left bias) continued its trend of publishing primarily from left-wing media outlets in 2025, displaying 2% of news articles from outlets on the right, and 50% from outlets on the left.
This is consistent with data from our 2023 analysis, when Apple News curated 1% from outlets on the right and 53% from the left.
While users can personalize which outlets appear on their Apple News app, for the purposes of this analysis, AllSides looked explicitly at Apple News’ ‘Top Stories’ and ‘Trending Stories’ sections, which are not personalized for individual users and are curated by Apple’s editors.”
AllSides published the following exhibit:
(click / tap exhibit to enlarge)
The chart caught my attention as it implied there has been no recent or sudden change in what Apple News has been doing.
Apple News relies on a few dozen former journalists to select the stories that comprise Top Stories. The selections are updated
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Apple Acquires Q, The Key Q Patent, Apple Is Developing a New User Interface
Hello everyone. Today’s update will be dedicated to Apple’s Q acquisition. At $1.6B, this is the second-largest Apple acquisition in terms of deal value. It’s a fascinating acquisition. Let’s discuss.
Apple Acquires Q
Here’s Reuters:
“Apple on Thursday said it has acquired Q.ai, an Israeli startup working on artificial intelligence technology for audio.
Apple did not disclose terms of the deal for Q.ai, which was backed by venture capital firms Matter Venture Partners, Kleiner Perkins, Spark Capital, Exor and GV, formerly known as Google Ventures. The deal valued the startup at about $1.6 billion, according to a source familiar with the matter.
Apple did not say how it will use Q.ai's technology but said the startup has worked on new applications of machine learning to help devices understand whispered speech and to enhance audio in challenging environments.
Q.ai last year filed a patent application to use "facial skin micromovements" to detect words mouthed or spoken, identify a person and assess their emotions, heart rate, respiration rate and other indicators.
Q.ai's 100 employees, including CEO Aviad Maizels and co-founders Yonatan Wexler and Avi Barliya, will join Apple, the companies said.
Maizels founded three-dimensional sensing firm PrimeSense and sold it to Apple in 2013. The PrimeSense deal eventually helped Apple move away from fingerprint sensors on its iPhones and toward facial recognition technology.”
Johny Srouji, Apple’s SVP of hardware technologies, provided the following statement to Reuters: Q “is a remarkable company that is pioneering new and creative ways to use imaging and machine learning. We’re thrilled to acquire the company, with Aviad at the helm, and are even more excited for what’s to come.”
When Apple acquired PrimeSense in 2013 for $360M, the company simply confirmed the acquisition and the provided what had been its generic "Apple buys smaller technology companies from time to time, and we generally do not discuss our purpose or plans” M&A comment.
The Q acquisition includes technology (with accompanying patents) that have very high probabilities of being brought to market via Apple products. Apple is not going to
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Reading Between the Lines of Apple’s 1Q26 Earnings Q&A With Analysts
Happy Monday.
Today’s update will conclude our Apple 1Q26 earnings review with the latest installment of Reading Between the Lines. After recapping each question-and-answer exchange that occurred on the call between Apple and sell-side analysts, we will go over my response to the exchange.
Let’s go beyond what was talked about on the call with the 17th installment of Reading Between the Lines of Apple's earnings Q&A with analysts.
Reading Between the Lines of Apple’s 1Q26 Earnings Q&A With Analysts
NOTE: The following earnings call questions (“Q (Sell-Side Firm)”) and answers (“Cook” or “Parekh”) have been cut, summarized, paraphrased, and rearranged for clarity. To read the full question and answer exchanges, The Motley Fool offers a written transcript here.
iPhone
Q (Morgan Stanley): What are the top factors driving iPhone strength?
Cook: It’s a combination of things – display, camera, performance, new selfie camera, design.
My response: We also can’t underestimate the degree to which
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Apple Reaccelerates Share Buyback, Apple’s Stellar Free Cash Flow, Takeaways From Apple’s 1Q26 10-Q
We will continue our Apple 1Q26 earnings review by turning to Apple’s capital management, balance sheet, and 10-Q.
For those of you who are new to the Above Avalon Daily newsletter, our goal for each Apple earnings review is to not leave any financial stone unturned. After today’s email, there will likely be one additional update dedicated to reviewing Apple earnings before moving on to other topics.
Let’s jump right in.
Apple Reaccelerates Share Buyback
We have new data for Apple’s share buyback activity. The following totals are for Apple's share repurchases via open market transactions over the past two years:
1Q24: $20.5B spent on buyback. Average repurchase price per share: $183.77.
2Q24: $23.5B. Average repurchase price per share: $180.37.
3Q24: $26.0B. Average repurchase price per share: $187.36.
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Apple 1Q26 Earnings Review: Margin Concerns Are Overblown
Happy Wednesday.
To recap where we stand with reviewing Apple's 1Q26 earnings.
Last Friday: Big picture overview and the numbers
Tuesday: All about iPhone
Today: Margins
Let's jump in.
Apple 1Q26 Earnings Review: Margin Concerns Are Overblown
Heading into Apple’s 1Q26 earnings release, margin concerns were among the list of items thought to be contributing to Wall Street’s negative view regarding Apple. Memory pricing inflation had been in the news for weeks. There was also growing chatter and speculation surrounding the Apple / TSMC relationship as it pertained to future pricing and supply. We could have even thrown in lingering tariff cost concerns into the margins discussion, although the tariff topic does seem to have genuinely been put on the back burner for now with Apple’s exposure being contained.
Based on Apple management’s commentary on the 1Q26 earnings call, gross margin fears are overblown based on how events on the ground are trending. While Apple will likely see some pressure from select higher component pricing, a handful of tailwinds are positioned to help offset those headwinds.
Memory accounts for a relatively small percentage
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Apple 1Q26 Earnings Review: Let’s Talk About iPhone Results
Happy Tuesday. We are going to continue our Apple 1Q26 earnings review. Today’s update took a bit longer than expected to finalize.
Last Friday, we went over my initial thoughts regarding Apple’s results and how the numbers compared to my estimates. 1Q26 earnings and 2Q26 guidance were very strong. For this week, we will take a closer look at specific earnings-related topics. Today’s update will be focused on the iPhone.
Apple 1Q26 Earnings Review: Let’s Talk About the iPhone
Based on Apple’s earnings releases and conference call with analysts, here’s what we know about the latest iPhone results:
iPhone revenue: $85.3B (up 23%).
The $85.3B of revenue was constrained a bit by supply (advanced node 3nm capacity for SoCs). This supply shortage materialized via “very lean channel inventory” as management could not put as many iPhones into the channel as they wanted.
Apple said they sold a record number of iPhones in China in 1Q26 (Greater China revenue was up 38%). Records were put in for number of upgraders and strong double-digit growth on switchers. Recall how Apple’s 4Q25 iPhone results were hit by iPhone shortages in China.
As shown in the exhibit below, Apple is experiencing a step-up in iPhone revenue from approximately $200B/year to
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Apple 1Q26 Earnings Review: People Want What Apple Is Selling
Hello everyone.
Welcome to a special Friday edition of the Above Avalon Daily. It’s been a busy week. For today’s update, I wanted to share the big picture takeaway from Apple’s earnings and how results compared to my estimates. There is plenty more to discuss. We will do that next week.
Have a great weekend.
Apple 1Q26 Earnings Review: People Want What Apple Is Selling
The theme to our Apple 1Q26 earnings preview was divergence. Wall Street had turned skeptical of Apple just as the company’s business fundamentals were entering a higher gear. Apple’s 1Q26 results validated that theme. Apple reported its best quarter in four years. To then have Apple’s very strong 1Q26 results be constrained by supply tells us that demand is improving even faster than what is implied by the numbers. While the iPhone deservedly is getting much of the attention – revenue up 23% - the entire Apple ecosystem is seeing improved demand. People want what Apple is selling.
We have spent the past 18 to 24 months talking about how Apple product demand was beginning
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Meta 4Q25 Earnings Results: Impressive Growth, but at What Cost?
Happy Thursday. Apple’s FY1Q26 earnings are out. Both 1Q26 results and 2Q26 guidance were strong. We will talk about it tomorrow (Friday).
For today’s update, we will continue our earnings reviews with Meta.
Let’s jump right in.
Meta 4Q25 Earnings Results: Impressive Growth, but at What Cost?
For the past few quarters, a financial narrative battle has surrounded Meta. Following the company’s 4Q25 earnings release, this battle remains front and center.
One side thinks the Meta story should be primarily focused on revenue growth. Along those lines, there is a compelling story to tell.
Meta’s 4Q25 revenue was up 24% to $59.9B.
Meta’s 4Q25 ad impressions were up 18%.
Daily active users was up 7% to 3.58B.
Billions of users are spending more time on a Meta property consuming video clips, text posts, articles, and advertising.
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Previewing Apple’s 1Q26 Earnings: My Estimates, Above Avalon Expectation Meters (1Q26 Edition)
Hello everyone. Today’s update will conclude our Apple 1Q26 earnings preview. Apple reports earnings on Thursday at 4:30 pm ET.
Let’s jump in.
Previewing Apple’s 1Q26 Earnings: My Estimates
The overall theme to my Apple FY1Q26 estimates: improving fundamentals. Most financial line items are trending better in FY2026 compared to FY2025. There are a few exceptions which we will discuss in a few minutes.
Apple will report the following records on Thursday:
Quarterly revenue
Operating income
Net income
iPhone quarterly revenue
Services quarterly revenue
Services gross margin
Here are my expectations for Apple’s key 1Q26 metrics:
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Previewing Apple’s 1Q26 Earnings: Wall Street Is on Edge
Hello everyone.
Monday doubled as snowstorm cleanup day here in Connecticut. We received a little bit north of 16 inches, the most in about a decade. It certainly felt more during cleanup.
For today’s update, we will begin previewing Apple’s 1Q26 earnings which will be released on Thursday. The discussion will roll into tomorrow's update as well.
Previewing Apple’s 1Q26 Earnings: Wall Street Is on Edge
We are witnessing one of the largest divergences heading into an Apple earnings release in recent memory.
The company’s business fundamentals continue to improve. The company is going to report an all-time quarterly record on a few fronts on Thursday. Thanks to strong device sales trends and robust Services performance, revenue growth is trending 3x stronger than what it was last year at this time.
Set against these improving trends, Wall Street’s attitude and feelings toward Apple has turned negative over the past two months.
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Exclusive Analysis. Receive the Above Avalon Daily newsletter, widely-recognized as the leading daily newsletter dedicated to Apple. Now in its tenth year.
Archive Access. Access previous updates sent to members in an easy-to-navigate archive built in Ghost.
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