AI is turning Apple into a "loser"

https://www.axios.com/2025/07/10/ai-apple-stock-market

by elsewhen • 1 year ago

36 89 1 year ago

It’s far deeper than that and been Cooking for a long time before the AI boom, it was just less obvious because there wasn’t anyone to measure it against. But the cracks were visible and the direction obvious even 5 years ago

lotsofpulp2• 1 year ago

Almost 5 years ago, Apple introduced a laptop that blew everyone away.

walthamstow• 1 year ago

Blew everyone in tech away, myself included. Nobody else noticed. From what I can gather they sold a few million units of the M1 Air. It's not a very big market.

Ylpertnodi• 1 year ago

Include me out, please.

whywhywhywhy2• 1 year ago

Yeah after the 5 years where their main laptop model had a keyboard that became unresponsive within weeks, had a charger and power system that couldn’t even cold boot the machine it needed to sit there and pre-charge before it could boot itself, ran hot, ran slow, ran noisy.

I know we all love the post-M1 MacBooks but it’s increasingly obvious that machine is the exception to the decline of everything else including the laptop line until M1 redesign saved it.

bhouston5• 1 year ago

No one comes close to Apple's ecosystem of hardware. It is amazing and it isn't a simple matter for another company to approach it in the near term.

taco_emoji2• 1 year ago

Cooking

I see what you did there...

rcore• 1 year ago

Might as well turn them into a winner.

bluetidepro• 1 year ago

The bottom line: Apple has 24 to 36 months before it has its own AOL moment, according to Brian Mulberry, client portfolio manager at Zacks Investment.

That quote alone is hilarious. What a low effort article.

evklein• 1 year ago

Most financial news is basically pure speculation with a few quotes thrown in from people who are "absolutely certain" about their holding position.

empath753• 1 year ago

Do any of these people know that Apple is a hardware company and all of their services are just a side business? Apple is poised to make a fortune selling devices powered by their low power consumer chipsets that can run neural networks. There's really no competitor in that space.

Apple has plenty of time and money to watch other people flailing around trying to make AI first devices until they even really start to take it seriously. Even if someone else figures out to make a killer mobile AI app, it will absolutely support iPhones for the foreseeable future. All apple needs to do is make sure their chip pipeline supports it.

Google is the one that is facing an existential threat. Most people see their search engine as basically just a shitty ad-infested chatbot that produces worse results than chatgpt.

msgodel3• 1 year ago

Someone should let the shareholders and whoever writes Apple's quarterly reports know then.

alephnerd5• 1 year ago

Apple is a hardware company

A hardware business cannot demand a P/E ratio in the 30s range, especially given that supply chain disruptions are going to eat heavily into their margins.

dzhiurgis3• 1 year ago

low power consumer chipsets that can run neural networks

In 2040s

rib3ye2• 1 year ago

Not an AOL moment, but they do seem to having an OS 9 moment: Releasing stuff just to slap a larger number on the box.

Ironically I was playing around with BasiliskII last night and was reminded how janky and tasteless the OS got before making the break to Aqua.

But now there is no “war path” Steve Jobs to come in and basically lay down their life fixing the product line up.

pogue• 1 year ago

What is an "AOL Moment"? Some kind of point of complete failure?

I searched & asked ai but I couldn't find the context.

const_cast2• 1 year ago

Releasing stuff just to slap a larger number on the box.

I mean, it seems to be working. Which is sad and I think says something about consumers.

bachmeier• 1 year ago

That's not an accurate quote. You skipped the rest of it:

"With the cash they have on hand and the loyalty they have…there would have to be something disruptive in the marketplace that would draw away customers. It's not there yet," he says.

I take that to mean they're in a good position now, but they might start losing customers in the next 2-3 years, should stronger competitors show up. I don't disagree. I don't see Apple doing anything special that will protect them as different kinds of hardware come to market. Steve Jobs was responsible for the iPhone and iPad. Apple can only ride on his work for so long.

spacemadness2• 1 year ago

I really hope investors buy into this as it’ll be a great new entry point into the stock. I mean they seem to be buying into whatever without thinking so why not. AOL moment indeed.

sd9• 1 year ago

Shorting AAPL would probably be a bad idea

nottorp2• 1 year ago

"With the cash they have on hand and the loyalty they have…there would have to be something disruptive in the marketplace that would draw away customers. It's not there yet," he says.

Like what, a working phone that doesn't spy on you?

[Mind, they seem to be forgetting about that lately.]

jjice• 1 year ago

Curious of if I missed some poor privacy practices from Apple lately. I know they had the default advanced image search stuff [0], but that's all I'm aware of.

[0] https://support.apple.com/en-us/122033

nottorp2• 1 year ago

Maybe I was referring to "working".

I use my phone too little to have an opinion, but I have two macs, one running Sonoma and one running Ventura, and the latter - and older - is the most stable.

coliveira• 1 year ago

It all depends on who is going to be the loser faster. If the other companies that are spending $1T on soon-to-be-outdated infrastructure don't make money from their new super AI systems, Apple might just as well be the healthiest of them all.

bhouston5• 1 year ago

There is no one challenging Apple on hardware right now. And all of these AI tools can run on Apple machines. So I am not sure that I see Apple falling from its current situation.

That said, Apple isn't really riding this wave of AI. So I feel that Apple isn't benefiting, thus it could likely be growing more than it is if it has an AI strategy that was effective.

So I don't think Apple is a "loser" but it also isn't a "winner." It is more of a spectator who is still strong in their own domain, at least for now.

htk• 1 year ago

Unfortunately, this measured (and IMHO very reasonable) opinion doesn't generate clicks.

Imustaskforhelp• 1 year ago

Apple tried to ride the wave of AI and failed (Apple Intelligence?)

Apple has recently released a paper which says AI is all maths but a lot of people are saying that they are just "coping" with them losing the AI race.

Apple is one of the largest companies, with I guess a lot of cash and just power. So if they still can't win/compete effectively in the AI race when they had gone all in once does raise some questions about what really is happening within Apple.

bhouston5• 1 year ago

Apple tried to ride the wave of AI and failed (Apple Intelligence?)

It was a crappy product, I agree. I keep it disabled.

Apple has recently released a paper which says AI is all maths but a lot of people are saying that they are just "coping" with them losing the AI race.

It is a single paper and not reflectively of company strategy.

Apple is one of the largest companies, with I guess a lot of cash and just power. So if they still can't win/compete effectively in the AI race when they had gone all in once does raise some questions about what really is happening within Apple.

Apple has to compete with other hardware vendors primarily right? Samsung mostly. And they are doing that effectively.

Everyone's models are being obsoleted 6 months after they are released. It is a capital intensive market and it isn't clear anyone is actually profitable. I am not sure that Apple needs to get involved in this race, especially when there is little that is proprietary for more than a few months.

That said, if Apple did need to get into this race, they should just buy Anthropic. It is a no drama company that just delivers. It would match Apple's corporate style and it would likely deliver a lot of key features into the various OSes.

bitsandboots• 1 year ago

Similar conclusion - they're "losing" if the goal is marketshare and mindshare dominance. If the goal is just to carve their own niche, they're already there.

But, if you compare the growth into new spaces Apple did in the 2000s, then sure Apple of today hasn't done anything new in a while. Does it need to? Maybe from an investor point of view?

The hardware side is its own thing - some do not challenge their hardware because their goals are different like Facebook going cheap on VR rather than expensive). While nobody has as complete of a portfolio on what the M-chips have accomplished, the GB10 and Ryzen AI Max Pro seem to be similar in capability, yet late to the party and at this point just one-offs. But I don't think that really matters. Few people are buying based on deeply researched specs, so whatever is cheap and has battery life will do and there's happily plenty to choose from these days.

const_cast2• 1 year ago

There is no one challenging Apple on hardware right now.

This isn't true IMO. Everyone is challenging them and has for a long time. Android phones have better hardware, by any arbitrary metric. Camera, screen, battery, processor - Apple doesn't have a moat here. Don't get me wrong, their stuff is good. But is it the best? Ehhh... it's close, for sure.

Same thing with Macs, just a bit more in Apple's favor. Is M series good? Yes. Is it the best? IMO, no. x86 still has an edge in many applications. Some newer processors, like Intel's Lunar Lake, challenge M in both power and power consumption. Is ARM the future? IMO no - ARM is just a vessel. Low-wattage SOCs with RAM baked on are the future for mobile devices. Intel can do that, and they did, and it competes. But with all the benefits of x86.

I mean, I'm driving 2 1440p 240hz monitors right now on Lunar Lake over thunderbolt. Not a single dropped frame, ever. And at less than 30 watts - that's for everything, it's an SOC. Apple users a bit deceived - once you jump onto the Apple ship, you stop looking at competitors. But the competitors are good. Like, really good these days.

Apple's moat is their software. They keep a tight, tight grip on it. iPhones are popular in the US because of iMessage, pretty much exclusively. If Android phones could send and receive iMessage and transfer everything over, then it's over for Apple. They know that which is why it would never happen willingly.

If Apple's moat was hardware, they would have no problem distributing their software like candy. But they don't.

dzhiurgis3• 1 year ago

Regulation can.

Allow running any AI agent natively and see world take off. Apple is sitting on so much value and straight up refuses to share.

ulfw2• 1 year ago

Apple worries me a bit lately and by lately I mean in the last five six years. It seems Covid did a thing and all innovation and development efforts halted since 2000 or so. The Apple Car project was a huge boondoggle. Meanwhile Xiami delivered and succeeded with the SU7 and now YU7. Apple will finally introduce a foldable phone in late 2026, with specs rumored to be worse than today's Android flagships such as Oppo Find N5, which I use or the new Samsung Fold 7 and Honor Magic V5 etc. And let's keep in mind we are in the 7th iteration of such devices already. Vision Pro might have been technically nice but there is no market for it, let alone for it's price point and hence barely any developers jumped on it.

The iPhone has stagnated so much I got the Oppo after having had every single iPhone since the original one in 2007. I legit cannot list a single notable thing that is new in the 16 Pro vs. the 15 Pro. The only thing that came to mind was the 48mp ultra wide sensor chip married to such a shitty lens that it legit has worse quality than my 15 Pro's old 12mp chip. I tested them back to back.

I've been a huge fanboy for decades but lately absolutely nothing from the company excites me anymore as they just can't deliver. The big new Apple Watch update that was rumored never came. Meanwhile we have so much better looking rounded OLED ones from competitors.

EmptyCoffeeCup• 1 year ago

Only matters for people who care; that is not even the majority of apple users.

It is well established that upgrading every year is a waste of funds; A lot of users buy a phone every 5-8 years (or after a destructive event) -

IOS is nice to use. That's all that matters to a huge proportion of the market.

Me? I'll keep my 13 Mini until it dies, or until a new "Mini" is released - phones don't need to be massive.

BuckRogers• 1 year ago

iPhone 12 mini lover and user checking in here. The haters will berate us for our choice stating that "no one wants a small phone", but that's a lie. Normal sized phones were never going to be instant day-one hits. It's a self-fulfilling prophecy to launch them during Covid, offer them 2 years, and say no one wants them.

Give them a permanent place in the lineup, treating phones like every other very personal device meant for humans. Small, medium, and large.

If you do that, and give people time to see exactly why 5.42 screens are superior to 6.1"+ sizes, then I think the numbers will start to change from what we saw with the iPhone 12 mini and iPhone 13 mini, which were both launched when people were less on the go than in 100 years.

ulfw2• 1 year ago

Only matters for people who care

okay mate

Seems you care enough to reply that you don't care

saubeidl• 1 year ago

I think Apple turned into a "loser" when they let the MBA guy take the CEO seat from the designer guy.

Yes, short term business efficiency has increased. But other than an under-the-hood chip change (which, to be fair, was really impressive), they haven't really done anything disruptive since.

mitchitized• 1 year ago

Definitely not seeing the horrendous collapse of the once mighty Apple.

That said, they have always been behind the curve with AI, and recent product releases/updates have been, uh, suboptimal. Latest Logic Pro is a disaster (e.g. unstable/crashing, removed key shortcuts killing productivity) and don't get me started on the dumbing-down of iOS.

They are for sure headed in the wrong direction, but they are just too big to fall overnight.

bhouston5• 1 year ago

That said, they have always been behind the curve with AI

I am reminding when Android phablets were really cutting into the marketshare of Apple a decade ago. Apple was reluctant to release larger phones for a couple years and it was an opening.

But then all of a sudden Apple did release larger phones and the capabilities gap disappeared and then Apple's phone quality + CPU speeds + surrounding ecosystem of devices made the Android competitors pretty irrelevant.

msgodel3• 1 year ago

The problem will come when LLM driven assistants become more popular. There's no way to have a nice one on iOS without Apple giving up more control than they're willing to.

ethbr15• 1 year ago

Also, the lost time iterating.

Apple should remember from its Maps debacle that it's difficult to make up years of product tuning overnight, no matter how talented a team you have.

Time >> talent

Because everyone has talent within the same order of magnitude, but no one has invented a time machine.

freedomben3• 1 year ago

Apple will make an exception if it's in their own interest. They also have enough money to just buy out a company and airlift them in. If there's one company that could stumble around for 20 years and still have enough money to continue without much worry, it's them.

JohnMakin• 1 year ago

I don’t mind apple devices but one really frustrating thing to me is how bad Siri is. It’s always been frustrating, but the fact that they were one of the first to enter a voice assistant market that could try to do advanced natural language processing and execute tasks, never really delivered that, and despite massive gains in this space that AI has enjoyed, they’re somehow still behind there.

I am disabled and would pay buckets of money for certain things that siri obviously should be able to do but can’t. If I suffer a fall alone and yell “hey siri, I fell, call 9-11” I’m not entirely certain she can reliably do that and that’s insane to me.

taco_emoji2• 1 year ago

They'll be fine. Investors have a boner for AI right now but that won't last.

xnx• 1 year ago

Overhyped in the short term. Underhyped in the long term.

FabHK• 1 year ago

Has Axios changed the headline? It's now:

AI is turning Apple into a market "loser"

_fat_santa• 1 year ago

Big LOL on this one.

Apple could have said "we are not doing any sort of AI" and they would still be worth what they are today.

Did the author forget that everyone and their grandma has an iPhone in their pocket and an Apple Watch on their wrist?

bobosha• 1 year ago

So did everyone and their grandma also have blackberries.

exitb• 1 year ago

Is there a phone out now, or at least on the horizon, that can do significantly more due to better integrated AI?

geodel• 1 year ago

No. Blackberries were in pockets of executives and business people.

empath753• 1 year ago

No. Blackberry _never_ had the market penetration that apple had. They were an enterprise first company and barely had a foothold in the consumer market.

Apple wiped out blackberry in the enterprise market after it dominated the consumer market and it _barely even tried_.

biker142541• 1 year ago

No, not really. Peak Blackberry was both tiny compared to iPhone usage today and in a very different context, with very little of the economy or daily lives invested directly into a rich ecosystem dependent on the phones.

JimDabell• 1 year ago

BlackBerry peaked at ~80M users. iPhone is currently at ~1.5B. Why are you treating them as if they are even remotely similar?

TiredOfLife• 1 year ago

Only in MURICA. Other countries use Android, dumbfones or nothing

baal80spam• 1 year ago

That's just not true.

benguild• 1 year ago

https://news.ycombinator.com/item?id=44519452 I just posted that the Foundation Models aren’t really delivering much confidence

mrweasel• 1 year ago

Apple "needs the AI story because that's what's being rewarded in the market,"

Okay, so it's not actually because the users need something that can only be provided by an Apple AI. It provides little to no tangible benefit to Apples customers. It's just that the stock market would like to be able to tick the "Has AI" box on the APPL stock.

zaphod420• 1 year ago

This is just a dumb article. Comparing Apple to AOL is insane.

readthenotes1• 1 year ago

Right? They should be compared to Compaq or.. what's the name of that phone company that was really big before the iPhone came out?

rthrfrd2• 1 year ago

Or maybe it’s like Toyota and EVs.

alephnerd5• 1 year ago

Toyota at least invested in building a battery supply chain with Idmetsu Kosan years ago, and is working on battery tech national projects within Japan.

Apple hasn't done the same kind of homework yet, as Siri has largely been moribund nor will Apple be the reciever of significant state funding and subsidizes for R&D the same way Toyota is.

rthrfrd2• 1 year ago

Well if you want to continue the analogy, I could say: Apple at least invested in a SoC architecture years ago has already put it in a different league as far as AI capabilities go.

So to say they haven't done "the same kind of homework yet" seems quite presumptive. Only Google has done anything remotely similar with TPUs and certainly not on the deployment scale that Apple has done.

FWIW I don't care either way, I don't get emotionally attached to corporations, I just think the entire framing of the original post is very reactionary and naive, and I continue to think that the comparison with Toyota is an apt way to illustrate that.

antfarm• 1 year ago

AI for AI's sake might as well be a losing strategy. Apple will probably be fine.

alephnerd5• 1 year ago

Unlike the others on here - the Axios argument does make sense.

Essentially, the trade war related instability has made it's hardware story much more precarious (just like for any other consumer or enterprise hardware vendor), so some sort of a software story is needed to help cushion margins.

The issue is, aside from the App Store, Apple traditionally never had a strong software story. If Apple does not build some sort of a software story (which at this point is AI), it's harder to justify it's current valuation and it's "FAANG" status.

It's also undeniable that a LLM Chatbot player WILL make the foray into make their own bespoke hardware in order to target the consumer market, and the "chatbot as an oracle" UX does have strong traction amongst non-technical personas.

RIM, Sony, and Nokia were also on top of the world in 2007-09, but quickly saw their fortunes turn around as Apple's App Store+Hardware Design+Gated Ecosystem story helped provide some polish and a UX that the others failed to provide.

Essentially, if Apple didn't bungle Siri, they wouldn't be in the current situation today, and Apple is facing significant risks due to supply chain instability. Some diversification is needed.

empath753• 1 year ago

It's also undeniable that a LLM Chatbot player WILL make the foray into make their own bespoke hardware in order to target the consumer market, and the "chatbot as an oracle" UX does have strong traction amongst non-technical personas.

I am sure that there are going to be a bunch of these and almost all of them will suck, and if apple tried to make one now, it would also suck. Apple didn't invent the mobile phone, or the laptop, or the mp3 player, etc. They'll let someone else figure out if there is a market for it and then they'll refine it.

alephnerd5• 1 year ago

They'll let someone else figure out if there is a market for it and then they'll refine it.

The same was said about Nokia, RIM, Sony, and Microsoft, yet they failed. The current iteration of leadership at Apple doesn't have a strong history of successfully launching monetizable software plays other than the App Store, and that is a fairly distinct muscle.

More critically for Apple and the target personas who read Axios, Apple will not be able to justify it's current P/E ratio, because it's growth story has become difficult and it's margins are weaker now. That is why Apple is "turning" into a loser.

Apple didn't invent the mobile phone, or the laptop, or the mp3 player, etc

Apple in the 2000s also didn't have a PE ratio in the 30s, which gave it more breathing room as it's product was it's products, not it's stock. Apple became a victim of it's success, as it is now treated as a blue chip - and by blue chip standards it is one of the less diversified ones (similar to Tesla imo)

benoau• 1 year ago

Relentless gatekeeping is turning them into a loser. iOS should be the platform where users reap the benefits of all the winners of AI but instead Apple gets to decide who may have a deep integration as an auxiliary to Siri, whose only saving grace is it is permanently-entrenched as the assistant no matter how far behind it falls.

msgodel3• 1 year ago

Exactly this. Apple has to kill their baby if they want to continue and they don't have a leader with the will to do that.

nashashmi2• 1 year ago

Apple Has many options to turn on AI. Their current goals (local private LLM) are too ambitious and AI has not caught up to that kind of goal. If they want to force AI, they can use a less ambitious approach: everything gets shared with Apple servers openly and AI queries that data.

But their approach is so aloof of industry development that it will take at least 2 more years for it to be Apple-grade quality. It has to be local. It has to be private. It has to be amazing. It has to work well. It has to have standard easy to use purposes. It has to be integratable into apps. It has to be intuitive.

They could just release a less ambitious Siri-Ai. Just to shut everyone up.

jaza• 1 year ago

I'm a notorious Apple hater, so I can't say I'll shed a tear if Apple does take a sizeable hit. But then again, I'm also a big sceptic of the AI hype wave currently gripping the world. My bet is that it's the latter, not Apple, that has 24 to 36 months left to live.

freedomben3• 1 year ago

I'm also a big Apple hater for their closed approach to everything and the broad impact that has had on the market (now everything is moving that way), and would not be sad at all if they took a big hit (it was a slow evolution over many years, but that's where I am now), but I agree I think Apple is actually fine. They have a ton of options (ranging from acquisition or integration with existing providers) and all the money they could possibly need to get any or all of those done. The majority of normal people are just using AI for chatgpt-style stuff anyway, and that stuff all works perfectly fine on the iPhone.

Maybe once Gemini is fully empowered to drive Android as a digital assistant Apple might need a good answer, but I think we're still a ways off from that point.

tuesdaynight• 1 year ago

I disagree with the article, but one thing that I learned is that HN is horrible with market predictions. I remember vividly how common was the prediction that Meta was going down here, 3 years ago. TikTok and Metaverse would kill it. Maybe Apple is really turning into a "loser".

jaredcwhite• 1 year ago

Completely absurd and ridiculous "analysis" with no basis in factual reality.

Consumers are actually down on AI now. There's increasing negative sentiment whenever a company advertises it now has "AI" in its products. They are trusted less, not more, and viewed with suspicion.

Apple is actually better positioned the more it relegates genAI to smaller local models which are good for a much more tightly-constrained number of key tasks for which LLMs aren't too horrifying.

josefritzishere• 1 year ago

This is absurd. I am not an Apple fan whatsoever but they're very successful bordering on dominant. AI is a fad, and overhyped. It will come abd go and Apple will still be the "A" in FAANG.

freedomben3• 1 year ago

I guess if Netflix is still in FAANG, it makes a lot of sense for Apple to be as well

npc_anon• 1 year ago

Apple is late but has the resources to catch up in AI. And if not, they can just partner with the AI providers. They'll even get paid for it, similar to Google handing over billions per year to Apple just to be the default search provider.

What is unfortunate for them though is that their AI miss is happening at the same time window in which smartphones seem close to done. They've produced 3 models in a row with zero memorable innovations. You can call Apple a hardware company but it's above all an iPhone company.

dep_b• 1 year ago

Apple would be in big trouble if their hardware mobile and desktop wasn't so much better, Windows wasn't a train wreck and Android was offering something more than a slightly less sucky version of Siri.

In the mean while most of its competitors are burning towers of money on AI products that they charge their consumers about 1/10th of the real cost for. While Apple goes for on-device agents that are essentially free to run.

AI is turning Apple into a "loser"

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