Key Points
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Innovative new tech could bring the power of advanced AI models to the iPhone.
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Partnerships with Chinese cloud leaders will help Apple bring AI services to its largest international market.
- 10 stocks we like better than Apple ›
Shares of Apple (NASDAQ: AAPL) jumped to a record high on Wednesday, following some positive developments for the tech titan.
More AI models could be coming to the iPhone
On Tuesday, CNBC reported that Apple was evaluating innovative technology that could shrink large artificial intelligence (AI) models to run directly on an iPhone.
PrismML, a tiny Silicon Valley start-up, licenses the technology from the California Institute of Technology. PrismML CEO Babak Hassibi said Apple is testing the tech’s performance on its devices.
If those tests prove successful, Apple could bring the power of advanced AI models to iPhone users. It could also help Apple reduce its cloud computing costs if AI applications can run directly on its devices.
And on Wednesday, news broke that the Cyberspace Administration of China would allow Apple to provide AI services in the populous country.
Chinese e-commerce and cloud giant Alibaba will integrate its Qwen AI model into Apple Intelligence. Baidu, China’s internet search leader, will also work with Apple to develop AI features for its devices.
Apple’s AI strategy is emerging
Apple has largely stayed out of the AI model race, much to the benefit of its shareholders.
Rather than spending tens and even hundreds of billions of dollars to compete with model makers like OpenAI and Anthropic or hyperscalers like Google and Meta Platforms, Apple has sought to partner with AI leaders to bring their innovations to its users.
It’s a smart, cost-effective strategy. And these recent developments are beginning to show that Apple can still benefit from AI without incurring massive costs.
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Joe Tenebruso has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet, Apple, Baidu, and Meta Platforms. The Motley Fool recommends Alibaba Group. The Motley Fool has a disclosure policy.
