What’s going on?

Apple made plans to integrate Google’s Gemini AI engine into its smartphones.

What does this mean?

• Investors have long been hoping for an AI breakthrough from Apple, and it’s now considering fitting out iPhones with Gemini. Given that AAPL’s down >6% this year, its worst performance against the Nasdaq 100 index in over a decade, Apple will be hoping investors respect the innovation, no matter whose name is on the patent
• Google’s investors won’t mind the collaboration, since the deal would be Gemini’s highest-profile partnership to date (as long as Apple doesn’t walk towards another competitor like OpenAI at the last minute).

Why should I care?

The bigger picture: The situation is bad, but not that bad

• iPhone sales are losing their pace, electric vehicle track records are essentially dead, and regulators are keeping an eye on them
• But with a spotless record of keeping profit controlled and innovating when it’s least expected, the situation probably won’t bother top investors.

Zooming out: Is AI better than traditional technology?

• AI-obsessed investors have sent Magnificent Seven stocks up, Goldman Sachs’ advice is to check out companies that are expected to use AI, rather than the ones churning out new high-tech products.
• That means pulling away from the likes of Nvidia and Meta, and taking a look at less flashy options like Walmart, Kohl’s, or Accenture.

Content source: Finimize (2024) Smart Phone. Available at: https://finimize.com/content/smart-phone [Accessed on Mar 19, 2024]