Source: PaxForex Premium Analytics Portal, Fundamental Insight
Apple, renowned for its sleek devices and robust ecosystem, often takes a backseat in discussions about artificial intelligence (AI), overshadowed by the initiatives of tech giants like Microsoft and Alphabet. However, dismissing Apple as a significant player in the AI space might be a mistake, considering the potential it holds with its ongoing development in this field. Here's a closer examination of why investors should not underestimate Apple's capability to emerge as a noteworthy AI contender.
While mainstream chatbots like ChatGPT and Bard currently dominate consumer and investor attention, the realm of AI is still in its early stages, and Apple is gearing up to make its mark in the generative AI space. The company is actively working on Apple GPT, positioning it as its response to existing chatbot technologies.
Recognizing that it lags behind its competitors, Apple is demonstrating its commitment to narrowing the gap by allocating substantial resources. According to a Bloomberg report, the tech giant plans to invest up to $1 billion annually in the development of generative AI, signaling its dedication to catching up and establishing itself as a formidable presence in the evolving AI landscape.
Apple's robust financial standing suggests the potential for a substantial investment in generative AI, with its reported annual spend of $1 billion appearing relatively modest in the context of the company's immense resources. Over the last four quarters, Apple has generated an impressive $101 billion in free cash flow, providing ample room for increased investment in the development of chatbots and AI integration into its existing products and services.
A key advantage Apple holds over its competitors lies in its ability to learn from their early forays into new spaces, avoiding pitfalls that may arise as first movers. With a strong and loyal customer base, Apple doesn't face the urgency of attracting new users, allowing the company to take a strategic approach. By leveraging insights from competitors' AI experiences, Apple aims to deliver a superior end product, focusing particularly on safety and data privacy – critical concerns for both companies and individuals using chatbots today.
While Apple's entry into the AI arena may take time, potentially pushing the integration of AI-powered products like Apple GPT into iPhones and iPads to late next year, the company's vast network of over 2 billion active devices globally remains a substantial asset. Despite Microsoft and Alphabet's early strides in AI, Apple's deliberate approach could yield more polished and refined offerings, aligning with its strategic and calculated focus in the current tech landscape.
Although Apple may not be leading the AI charge, its measured approach suggests a potential for significant success in the long run. For AI investors, Apple emerges as an underrated buy, with AI-enhanced iPhones, iPads, and Mac computers presenting an exciting prospect that could drive consumer enthusiasm and boost demand. While Apple may not be as widely recognized as an AI player compared to its rivals, it holds the potential to be a compelling long-term investment, offering room for growth as AI continues to evolve. Patience with the company's strategic timeline could make Apple shares a worthwhile investment today, positioning the business for sustained growth through the integration of AI technologies.
As long as the price is above 181.00, follow the recommendations below:
- Time frame: D1
- Recommendation: long position
- Entry point: 189.72
- Take Profit 1: 194.00
- Take Profit 2: 200.00
Alternative scenario:
If the level of 181.00 is broken-down, follow the recommendations below:
- Time frame: D1
- Recommendation: short position
- Entry point: 181.00
- Take Profit 1: 175.00
- Take Profit 2: 170.00
