Apple (AAPL) stock is climbing on news that the company is considering using artificial intelligence (AI) startups OpenAI or Anthropic’s large language models to power a new version of Siri. The step marks a strategic reversal for the iPhone maker, which has until now relied on its in-house AI models, known as Apple Foundation Models, to power most of its AI features. The news was first reported by Bloomberg, citing people familiar with the matter.
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Apple has been lagging behind its peer in the generative AI race. During its Worldwide Developers Conference (WWDC) held recently, the company delayed the much-anticipated rollout of its updated version of Siri without providing reasons. Moreover, Apple introduced only incremental developments in its technology, disappointing both analysts and investors.
Apple Looks Beyond In-House AI for Siri Upgrades
According to the report, Apple has been in discussions with both Anthropic and OpenAI to train versions of their Claude and ChatGPT models so they can run on Apple’s cloud infrastructure for testing. The talks are at an early stage and no decision on using them has been made, the report added.
Notably, Apple is already using ChatGPT to answer web-based queries on Siri, although the primary assistant is powered by Apple. The news of the third-party AI model testing seems to call into question Apple’s AI capabilities. The company has also reshuffled its AI team to accelerate the pace of AI innovation and execute product development.
If Apple does go ahead with using third-party AI models, it would bring the company on par with rivals like Samsung (SSNLF), which also uses Google’s (GOOGL) Gemini models to power its AI features. Meanwhile, Amazon (AMZN) uses Anthropic’s Claude to run the new Alexa+.
Is AAPL Stock a Buy?
On TipRanks, AAPL stock has a Moderate Buy consensus rating based on 16 Buys, nine Holds, and four Sell ratings. Also, the average Apple price target of $226.54 implies 10.4% upside potential from current levels. Year-to-date, AAPL stock has lost 17.9%.
