Apple: AI iPhone?

Until now, Apple boss Tim Cook has been “reluctant to talk about artificial intelligence”, said Lex in the Financial Times. All change. During last week’s quarterly earnings call, he declared that generative AI was a critical opportunity for the company. “The implication is obvious: an iPhone with generative AI capabilities is coming.” Frankly, Apple could use the boost. Despite having to contend with a US Department of Justice suit for running a smartphone monopoly, its long-awaited virtual reality set, Vision Pro, hasn’t contributed enough to the company’s $90.8bn quarterly revenues “to ameliorate a 10% drop in iPhone revenue”. Facing “saturated” markets in rich countries, and “growing competition from national champions” in emerging markets, Apple needs “to breathe new life” into its core business, agreed The Economist. This week’s iPad revamp is a start. But what really cheered shareholders, said Yun Li on CNBC, was the announcement of a $110bn share buyback – “the largest in company history”. Apple watchers were quick to note that Warren Buffett’s Berkshire Hathaway “cut its gigantic stake” in the company by 13% in Q1, to $135.4bn. Is the 93-year-old “Sage of Omaha” getting cold feet about his once-favourite bet? Apparently not. At Berkshire’s annual meeting, Buffett said the sale was for tax reasons following large gains. Apple’s stock gained a whopping 48% in 2023.