Apple's Late-to-the-Party AI Strategy May Be Its Smartest Move Yet

For years, critics have painted Apple as a laggard in the artificial intelligence race. Wall Street worried that a missing AI narrative would eventually dent iPhone sales. But last week's unveiling of Siri AI - powered by a partnership with Google Gemini and baked directly into the operating system - suggests the company may have been playing a different game entirely.

Apple's senior vice president of software engineering, Craig Federighi, didn't mince words: "Some appear to be racing forward, pursuing AI for the sake of AI, without clear regard for the people it's meant to serve." That jab at rivals like OpenAI and Meta signals a deliberate bet on user experience over speed.

The new Siri can mine your inbox and text history for relevant information, use onscreen awareness to offer context, and pull real-time web data via Gemini. It works seamlessly across Apple devices and stores chat histories for continuity. By embedding AI at the OS level, Apple also threatens competitors whose apps rely on the App Store for distribution.

But the real story is financial. Apple is spending roughly $14 billion on AI capex this year, versus a combined $900 billion from other tech giants. Meanwhile, it posted record iPhone sales last quarter and collects a tax on AI companies using its App Store. The contrast is stark: Apple is spending less, earning more, and now delivering AI features that many users will find indistinguishable from third-party apps.

Whether this wins Apple the "AI race" is debatable. But it may be the most profitable way to run it.

Source: TechCrunch