Apple CEO Tim Cook didn't reveal much concerning the company's AI plans during its second-quarter earnings call with investors on Thursday, but he did confirm just a few details about how the tech giant plans to maneuver forward with artificial intelligence.
In particular, his comments suggested that despite spending greater than $100 billion on research and development over the past five years, Apple doesn’t plan to open too many recent data centers to run or train AI models. Instead, as with other cloud services, it’s going to proceed to pursue a “hybrid” approach to AI, the corporate told investors.
AI will extend to devices beyond the iPhone
We also learned that Apple sees AI as a key opportunity for the “overwhelming majority” of the corporate's device lineup, not only the iPhone. While we've known this for a while – in any case, Apple calls its M3 MacBook Air the “best consumer laptop for AI” – the corporate highlighted how AI is utilized in its products in its earnings release.
“I believe AI – generative AI and AI – represent big opportunities for us across all of our products, and we'll be talking more about that in the approaching weeks. I believe there are many opportunities which are great for us and we predict we’re well positioned,” Cook said.
In addition to the MacBook Air, the Apple Watch leverages AI and machine learning in features comparable to irregular heart rhythm notification and fall detection, Cook noted. And when talking concerning the company, the CEO pointed to large corporations buying Vision Pro and exploring use cases for Vision Pro, but added that he didn't need to “limit this to only AI.”
“I’d just say that we see generative AI as a vital opportunity for all of our products. And we imagine we’ve benefits there that set us apart,” Cook said.
AI probably won't come up at this month's iPad event
However, customers who want AI-powered Siri could have to attend just a little longer for this news, which was long expected to be announced at Apple's Worldwide Developers Conference (WWDC) in June. When asked Thursday how AI will impact consumer demand for brand new devices just like the iPhone, Cook responded that we wouldn't see an impact on generative AI “inside the following quarter or so,” but said he was “extreme”. “optimistic” concerning the technology.
Apple doesn't plan to make its major AI announcements before WWDC.
This discovery got here about through a correction of a CNBC news story, which misinterpreted a press release from Cook that appeared to suggest that there could be “big plans to announce” from an “AI perspective” at each upcoming events, including next week's iPad event and WWDC in June. But as later corrections show (likely after a flogging by a frantic Apple communications team), Cook had paused before saying, “…from an AI perspective…”, which was the beginning of his next thought and had nothing to do with Apple's plans for needed to do with each events.
The story has been updated with this correction so people didn’t imagine that AI news could be announced on the iPad event scheduled for May seventh. (You can read the backstory to the corrections here on 9to5Mac.)
While we didn't expect to listen to much or anything about AI until at the least WWDC, this correction essentially confirms that time limit.
Apple is taking a hybrid approach to AI investments
The biggest AI news, nevertheless, is something Cook said about Apple's CapEx spending, which is money spent on fixed assets like servers and data centers, real estate, and more.
While it's hardly essentially the most interesting topic, this time the corporate's response hinted at Apple's AI investment plans. As technology investor MG Siegler identified on his blogApple CFO Luca Maestri responded to a matter concerning the impact of generative AI on Apple's historical CapEx pace by explaining that Apple follows a hybrid model, “where we make a number of the investments ourselves, in other cases we share them with ours.” Suppliers and partners…”
Additionally, he added, Apple is “doing something similar on the information center side. We have our own data center capabilities after which leverage third-party capabilities.”
“It is a model that has worked well for us up to now and we plan to proceed doing so in the longer term,” Maestri said.
Siegler interpreted this to mean that Apple doesn’t must spend on CapEx because Apple doesn’t plan to right away construct and train LLMs (large language models) by itself servers.
And in the event you squint just a little, this may be one other signal that Apple could also be in search of third parties to power its AI services. As Bloomberg reported in April, Apple has held discussions with ChatGPT maker OpenAI and Google to power an AI chatbot that appears in an iOS 18 update.
Since Apple has confirmed that its capital expenditures is not going to be affected by its near-term AI plans, it is probably going that Apple plans to contract with partners for AI services along with the tasks the corporate performs on the device and may handle yourself, are offered. It stays to be seen whether Apple will shift the balance over time and use more of its own servers and data centers.
