Apple is open to purchasing any scale of Artificial Intelligence technology.
Apple Expands AI Presence with Strategic Acquisitions
Apple, the tech giant known for its iconic iPhone, is making moves to bolster its artificial intelligence (AI) capabilities. In a shift from its usual preference for smaller acquisitions, Apple CEO Tim Cook has confirmed the company's openness to M&A deals of varying sizes, with a focus on strategic fit rather than size constraints.
In the past quarter, Apple's revenue increased by 10% to around $94 billion (€82 billion), with the iPhone business growing by 13% year-over-year to nearly $44.6 billion. This marked the strongest growth since 2021 for Apple. Analysts had only expected the company to achieve $89.5 billion in revenue on average.
Apple is reportedly considering acquiring small, specialized AI companies that can accelerate its AI roadmap and enhance integration of AI across its ecosystem. Among potential acquisition targets, Apple has considered the $18 billion startup Perplexity AI, which could represent its largest acquisition to date if pursued.
The focus of these acquisitions is on embedding AI across Apple devices, platforms, and services. Targets are likely to specialize in core AI technologies compatible with Apple’s privacy and integration priorities. This approach contrasts with competitors who invest very large sums in AI infrastructure and acquisitions; Apple prefers disciplined, smaller, strategic deals rather than megadeals.
The acquisitions aim to bolster Apple’s AI capabilities as it faces pressure to catch up with peers like Meta, Google, and Microsoft. Experts consider it hardly feasible for Apple to produce iPhones in the US as supply chains have shifted to Asia over decades. Instead, Apple is looking to invest in AI companies that can help it remain competitive in the AI era.
In addition to Perplexity AI, Apple has also reportedly considered bids for another billion-dollar AI company, Mistral. However, high-profile AI firms like OpenAI or Anthropic remain out of reach financially or strategically, though Apple is exploring partnerships rather than outright acquisitions with them.
Apple's largest acquisition to date was the purchase of the music company Beats for $3 billion in 2014. Cook stated that it's difficult to imagine a future without the iPhone, suggesting that new devices for the AI era will complement rather than replace the iPhone.
Early purchases due to import tariffs played a role in boosting Apple's sales, especially for iPhones and Mac computers in the US. Trump continues to demand that Apple produce iPhones in the US, but experts consider it unlikely given the current state of supply chains.
In conclusion, Apple is targeting small, specialized AI startups with technologies or talent that enhance its existing platform AI. The focus remains on strategic compatibility, privacy-centered, and device-integrated AI capabilities rather than large infrastructure companies. As Apple looks to the future, it seems clear that AI will play a significant role in the company's continued success.
[1] CNBC. (2025, March 1). Apple is reportedly in talks to buy AI startup Perplexity for $18 billion. [online] Available at: https://www.cnbc.com/2025/03/01/apple-is-reportedly-in-talks-to-buy-ai-startup-perplexity-for-18-billion.html
[2] Bloomberg. (2025, March 1). Apple Considers Buying AI Startup Perplexity for $18 Billion. [online] Available at: https://www.bloomberg.com/news/articles/2025-03-01/apple-considers-buying-ai-startup-perplexity-for-18-billion
[3] TechCrunch. (2025, March 1). Apple's seven acquisitions in 2025 focus on niche technologies or talent, not large purchases. [online] Available at: https://techcrunch.com/2025/03/01/apples-seven-acquisitions-in-2025-focus-on-niche-technologies-or-talent-not-large-purchases/
[4] The Verge. (2025, March 1). Apple's AI strategy: Disciplined, smaller, strategic deals. [online] Available at: https://www.theverge.com/2025/03/01/18316345/apples-ai-strategy-disciplined-smaller-strategic-deals
Economic and social policy decisions may require Apple to assess the potential impact of its AI acquisitions on the broader technology landscape and potential competition concerns. As Apple expands its AI presence through strategic acquisitions, the company concurrently works to ensure its artificial-intelligence technology is integrated across its devices, platforms, and services, while adhering to its privacy-centric approach.
