Apple's AI boom: Market value spikes after major announcement
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The astonishing melt-up in Apple shares over the past two days marks the beginning of the second phase of the AI hype cycle — where companies are rewarded not simply for building AI technology but more for incorporating it into their existing product suite.
Driving the news: Apple's market value has spiked by $312 billion over the past two trading sessions, causing it to reclaim its place as the most valuable company in the world.
Between the lines: That increase, in dollar terms, dwarfs the value of OpenAI ($80 billion), xAI ($24 billion), Anthropic ($18 billion), and all other AI startups combined.
The big picture: This week's announcement from Apple, which reportedly isn't paying OpenAI for its use of ChatGPT, marks the first time the general public has gotten a glimpse of how AI will improve the items we touch and use every day.
- The market's verdict: AI is going to make iPhone and iPad more valuable franchises — and, by extension, Apple itself.
Follow the money: One of the reasons the stock market continues to hit new record highs is that investors are pricing in a broad-based corporate productivity boost due to AI adoption.
- The move in Apple shares, because it was concentrated over a short period, can be seen as a sped-up version of what has been happening in many sectors over the past year or so — or, perhaps, can be seen as a harbinger of what might happen to many other companies as they start rolling out the fruits of their AI strategies.
The bottom line: Apple isn't a "picks and shovels" company like Nvidia, the stock market darling of the first phase of the AI hype cycle. It isn't selling AI chips or AI consultants or Large Language Models or even AI training data. It's selling phones, which will be better thanks to AI.
- That marginal improvement, it turns out, can be worth hundreds of billions of dollars.
