Apple shares (AAPL) rose about 1% to around $334 on Wednesday morning. This followed reports that the iPhone maker has been developing an enterprise AI server that will run on its own in-house chips. According to The Information, the company is also considering adding Nvidia’s (NVDA) networking tech to power the servers.
Apple Eyes Return to Server Market
The move would mark Apple’s return to the enterprise server market. It comes as the AI boom fuels server demand for makers such as Dell Technologies (DELL), Hewlett Packard Enterprise (HPE), and Super Micro Computer (SMCI). Notably, Goldman Sachs (GS) expects the AI server market to be worth $1.24 trillion by 2030.
According to the report, Apple plans to power the new server with its M8 Ultra chips. These are Apple’s most powerful chips yet.
The consumer electronics giant has weighed using Nvidia’s NVLink Fusion to link multiple of these chips together. NVLink lets third parties connect their CPUs and custom processors with Nvidia’s tech stack. This integration allows shared memory and data at extremely high speeds and with massive capacity.
However, Apple has not yet decided. The tech giant might decide to skip Nvidia’s tech altogether, the report noted. The AI server, when ready, could reach the market in 2029.
Why The Move Matters for Apple Stock
Meanwhile, the move comes as Apple has faced criticism in recent years for lagging rivals such as Google (GOOGL) and Microsoft (MSFT) in the AI race. The company has been criticized for not investing as heavily in AI infrastructure as its rivals.
Efforts to develop an enterprise AI server mark Apple’s latest push to capture gains from the AI boom. It comes days after Apple launched the AI-powered version of its popular Siri digital assistant.
Is Apple Still a Good Stock to Buy?
On Wall Street, Apple’s shares still carry a Moderate Buy consensus rating. This is based on 16 Buys, 12 Holds, and four Sells assigned by 32 analysts over the past three months.
Moreover, the average AAPL price target of $336.11 implies only about 1% upside (see the AAPL stock forecast here).
