Apple Inc struck out at a Goldman Sachs Group Inc analyst on Friday in a relatively rare public dust-up between a blue chip Wall Street firm and its client.
The disagreement came after Goldman Sachs analyst Rod Hall criticized Apple’s accounting methods for the tech giant’s new TV+ product, saying in a research note that it may result in lower gross margins and profits.
In response, Apple said it does “not expect the introduction of Apple TV+, including the accounting treatment for the service, to have a material impact on our financial results.”
A Goldman spokeswoman declined to comment or to make the analyst available for interview. Apple also declined to comment on the Goldman relationship beyond its comment on the note.
While research departments at large Wall Street banks have Chinese walls separating them from other functions, the rare public dispute is an awkward moment between the two companies.
Goldman Sachs has underwritten more bond issuances for Apple in the last decade than any other investment bank, worth some $44 billion, according to financial data provider Refinitiv. Goldman Sachs also advised Apple on mergers and acquisitions as recently as two months ago, guiding it through its $1 billion deal to acquire the majority of Intel’s smartphone modem business, according to Refinitiv.
And just last month, the two worked together to launch both companies’ first credit card — the Apple Card.
Every bank formally separates its equity research and investment bank divisions because of laws passed in the early 2000s that aimed to protect the independence of the equity analysts from investment bankers, who are often covering the same companies with different agendas.