They're All Making A Big Mistake

Joseph Carlson After Hours•Mar 17, 2026

Summary

Joseph analyzes a Wall Street Journal opinion piece that presents a fundamentally driven bull case for Apple based on its 'Apple Intelligence' strategy. Unlike competitors like Amazon, Google, and Meta, which are spending up to $700 billion combined on AI infrastructure, Apple is spending only $14 billion. Joseph explains that Apple intends to use its massive global footprint of 2.5 billion active devices as distributed mini-data centers to handle AI queries locally. This approach allows Apple to avoid the massive CapEx costs while acting as a disruptive intermediary for end users.

Regarding market outlook, Joseph discusses the tension between massive AI capital expenditures and the actual return on investment. He highlights that firms like Google may see free cash flow collapse as they fund these infrastructure builds. However, Joseph maintains a bullish stance on Meta, refuting the WSJ author's bearish claims by pointing out Meta's superior daily active user count of 3.58 billion. He also covers corporate actions at Intuit and Adobe, noting a shift in growth dynamics and management's response to market volatility.

AAPL: Joseph highlights the company's strategy of using proprietary on-device AI and the M5 chip to handle tasks like photo editing and text summarization without internet calls. He mentions that he recently sold his shares at approximately $200 per share because the valuation reached a 30 PE ratio despite single-digit revenue growth. Although he finds the current bull case compelling, he originally bought shares at a split-adjusted price of $43 in 2017.

META: Joseph remains very bullish on Meta, arguing that its 3.58 billion daily users give it a massive advantage over Apple's user base. He defends Meta's $135 billion CapEx spend as a necessary investment to become a vertically integrated technology company that is not reliant on third-party APIs. He disagrees with the notion that Apple will drain Meta's demand, noting that users seek immersive experiences that simple AI summaries cannot replace.

INTU: Joseph discusses how Intuit management is halting stock sales and doubling buybacks to combat a 26-30% drop in stock price. The CFO believes the market is overreacting to non-existent threats while the company's fundamentals remain strong with 18% revenue growth. Joseph praises this management behavior as an ideal response to market mispricing.

ADBE: Joseph describes Adobe as a mixed bag, noting that while it is a cash-generating machine, its revenue growth has slowed from over 20% to roughly 10%. He expresses concern that AI competitors like Canva and Midjourney are eroding Adobe's moat at the lower end of the creative market. For the stock to recover, Joseph believes Adobe must demonstrate an ability to reaccelerate its top-line growth.

NFLX: Joseph reports on Netflix's acquisition of Ben Affleck’s AI firm, Innerpositive, for a price tag that could reach $600 million. While the high price for a 16-person firm initially raised eyebrows, he notes that the tools are designed for safe, efficient AI editing. He views this as a strategic move to lower production costs and improve efficiency.

Summary

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