Apple At A Crossroads’ Analyst Says: Company Must Step Up On AI Or Get Left Behind
Apple Inc. (NASDAQ:AAPL) fails have been rare since the company introduced the iPhone in 2007, but the recent abandonment of its decade of research and investment in an autonomous car was a black-eye for the company.
Meanwhile, its latest launch, the Vision Pro, a “spatial computing” virtual reality and video headset, has met with mixed reviews and has a $3,499 starting price.
“With a dearth of impactful applications beyond watching movies, Vision Pro clearly needs vastly improved price/performance for bull arguments for disruptive upside opportunity to be credible,” said Rosenblatt analyst Barton Crockett.
What Apple needs, the analyst added, if it is to maintain its position alongside other Magnificent Seven stocks such as Microsoft Corp (NASDAQ:MSFT) and Amazon.com Inc (NASDAQ:AMZN), is to step up its artificial intelligence offerings.
Apple Shares Move South
Apple shares are down 11.5% year-to-date. It is no longer the world’s biggest company. Its market cap is still astonishingly large at $2.63 trillion, but it has fallen below Microsoft, which is close to $3 trillion.
By contrast, Amazon shares are up 14.8% so far this year, while Microsoft is 7.3% higher. Meanwhile, Meta Platforms (NASDAQ:META) is up 38.3% and NVDIA Corp (NASDAQ:NVDA), the supplier of AI-powering processing units, is up 70.5% already.
“If Apple can launch inspiring new AI capabilities, that could go some way to easing the current funk,” said Crockett.
Apple CEO Tim Cook said at the company’s December earnings report that the company expected “breakthrough potential for generative AI,” adding that it was currently investing significantly in this area.
