Tim Cook Says He's 'Open to M&A that Accelerates' Apple's AI Plans
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So far, Apple has mainly relied on outside data centers and focused on developing its own AI technology. But progress has been slower than expected, with Siri's upgrade pushed to next year. As a result, during Apple's Q3 earnings call, Cook told analysts that while the company has acquired seven smaller firms this year, it is also open to larger deals if they help speed up Apple's AI plans. 'We're very open to M&A that accelerates our roadmap,' he said, with CFO Kevan Parekh adding that this spending will rise 'substantially,' but not at an out-of-control pace.
It is worth noting that these plans come at a critical time for Apple. Indeed, its multibillion-dollar deal with Google to keep it as the iPhone's default search engine is at risk due to U.S. antitrust lawsuits. In addition, new AI startups like Perplexity are working with phone makers to challenge Google's dominance, with Bloomberg even reporting earlier this year that Apple had discussed buying Perplexity to improve its Safari browser. At the same time, Apple is preparing to spend more on data centers so it can use its own chips to process AI tasks while protecting user privacy.
Is Apple a Buy or Sell Right Now?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on AAPL stock based on 13 Buys, 12 Holds, and one Sell assigned in the past three months, as indicated by the graphic below. Furthermore, the average AAPL price target of $230.97 per share implies 13.7% upside potential.
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