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Apple (NASDAQ:AAPL) shares surged 7% Tuesday, one day after the Cupertino tech giant finally pulled back the curtain on its artificial intelligence offering, Apple Intelligence, at its annual Worldwide Developers Conference.
Although Apple arrived later to the stage than rivals Microsoft (MSFT) and Google (GOOG)(GOOGL) in presenting AI-driven products, the Tim Cook-led troupe might now be ready to steal the show.
TF International Securities analyst Ming-Chi Kuo believes Apple has an advantage over its competitors in offering on-device AI to customers.
“Apple has successfully defined on-device AI (at least consumers are already aware of the rich AI features and selling points of Apple’s AI devices), which will accelerate competitors’ imitation and catch-up, thereby driving rapid growth in the on-device AI-related industries,” Kuo said in a post on Medium.
Kuo determines the amount of DRAM is more important than computing power, or TOPS, to run Apple Intelligence. The iPhone 15 with an M1 chip can run Apple Intelligence, while those equipped with the A16 chip cannot. He concludes Apple Intelligence on-device LLM requires about 2GB or less of DRAM to run.
“Consumers may find purchasing Microsoft’s AI PC confusing (calculating whether it reaches 40 TOPS before purchase), whereas Apple directly tells consumers which models can support Apple Intelligence,” Kuo said. “Regardless of whether on-device AI applications meet consumer needs, Apple has a clear selling advantage from the start.”
