Sometimes, it’s all about expectations. Apple’s second financial quarter of 2023 results was a bit like a movie with bad word of mouth–but then you see it, and it wasn’t that bad. In fact, maybe it was… good? Sort of?

Or, to put it another way, when the economy looks shaky, it’s awfully nice when one of the most valuable companies in the world generates $94.8 billion in revenue and a $24.2 billion profit–even if it’s down slightly from the same quarter a year ago. After ringing a lot of warning bells three months ago, Apple’s business still seems pretty solid. If this is what a weak quarter looks like, Apple’s as blue-chippy as a blue-chip company could be.

As always, amid the numbers and Apple’s traditional phone call with financial analysts, there are a few nuggets to be gleaned about what Apple’s doing and what Apple CEO Tim Cook and CFO Luca Maestri are thinking. I’m just here to chew gum and mine nuggets, and I’m all out of gum.

A sigh of relief

This was a sigh-of-relief kind of quarter. Apple’s total revenue was off only three percent from last year, making it the second-largest Q2 in Apple history. The iPhone, Apple’s prime revenue generator, was slightly up–and set all-time records in Mexico, Indonesia, the Philippines, Saudi Arabia, Turkey, and the UAE. Apple’s second-largest budget line, Services, was also up slightly and set a new all-time record.

Dominik Tomaszewski / Foundry

The rest of the business was mixed. While Apple always tries to cart out some superlatives for the Mac, iPad, and wearables product segments, they were few and far between this quarter. It’s become clear that the Mac and iPad are victims of their own recent success, at least when it comes to sales trends: both products sold well during the early days of the pandemic, and the Mac also got a huge sales boost due to the arrival of Apple silicon. But with those days behind them, both products have to live up to the “tough compare” of last year’s second quarter, where the first Apple silicon MacBook Pros and the M1 iPad drove sales that this year’s models simply couldn’t match.

I wouldn’t worry about it too much, iPad and Mac fans. Both products are selling at levels never seen before the last couple of years, and there’s a lot of growth in the installed base of both. Apple also said that more than half of last quarter’s iPad sales were to first-time iPad buyers, which shows the growth potential of the platform.

Looking at emerging markets, especially India

After Tim Cook’s trip to India last month, there was a lot of talk about India during the analyst call. And the news was good, with Apple setting a quarterly record and posting strong double-digit growth. Cook called it “a major focus” with “unbelievable” vibrancy. Most importantly, Cook cited the rapid growth of a key customer base for Apple products: “There are a lot of people coming into the middle class” in India, he said, “and I really feel that India is at a tipping point, and it’s great to be there.”

If this sounds familiar, it’s because Cook said a lot of similar things about China a decade ago. But when asked specifically to compare the potential in India to that of China in the past, Cook demurred–a politically wise decision. “I think each country is different and has its own journey,” he said. Every country is a snowflake, but huge-population snowflakes with rapidly growing middle classes are Apple’s favorite.

Beyond India, though, Apple threw some love at other emerging markets where it’s doing well. “It was a great quarter for emerging markets in general, despite the [currency] headwinds,” Cook said. “We’re putting efforts in a number of these markets and really see, particularly given our low share and the dynamics of the demographics, a great opportunity for us in those markets.” In other words, in many of these markets, Apple’s overall market share and presence are so small that there’s almost unlimited room for growth. And Wall Street analysts sure love hearing about growth potential.

A little bit about AI

Veteran analyst Shannon Cross of Credit Suisse asked Cook if he had anything to say about the hot topic of the tech industry, artificial intelligence. And Cook had an interesting, if circuitous, response.

“I do think it’s very important to be deliberate and thoughtful in how you approach these things,” Cook said. “And there’s a number of issues that need to be sorted, as is being talked about in a number of different places. But the potential is certainly very interesting. And we’ve obviously made enormous progress integrating AI and machine learning throughout our ecosystem, and we’ve weaved it into products and features for many years, as you probably know. You can see that in things like fall detection and crash detection, and ECG. These things are not only great features, but they’re also saving people’s lives out there. And so it’s absolutely remarkable. And so we view AI as huge, and we’ll continue weaving it in our products on a very thoughtful basis.”

While Apple is often portrayed as being “behind on AI” because it doesn’t have its own Siri chatbot in beta, the truth is that the company has been using machine-learning-based technology in all sorts of corners of its platform, from sensor analysis on the Apple Watch to face- and object-detection in the Photos app. As for other stuff–I’m looking at you, Siri–it’s hard to tell if Apple’s lost the plot or is just keeping everything secret until the moment it springs a new AI-driven Siri 2.0 on us all. But “weaving it in our products” is not a bad way to describe what Apple has done, thus far, with AI.

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Horribles on parade

So what have we learned? Mostly, things are weird, and we’ve all been through a lot recently, but Apple is gonna be all right. On Thursday, Tim Cook carted out a new phrase to describe our weird era: “parade of horribles,” which actually sounds kind of fun in a Willy Wonka sort of way.

But it can’t compare to the “cocktail of headwinds” that Apple faced nine months ago. And when Cook introduced the phrase, he did so to emphasize that Apple was doing okay: “Despite this parade of horribles… we feel good about what we are and what our plans are.”

Sometimes you’re the horrible; sometimes you’re the guy with the broom at the end of the parade, sweeping up after the horrible. And all the while, you get the feeling that Apple’s been watching the parade from its shaded luxury box.