News of Apple Inc (NASDAQ:AAPL, ETR:APC) and Google’s discussions over the rollout of the latter’s Gemini AI chatbot on iPhones sent shares higher and prompted positive feedback from analysts on Monday.
Apple climbed 1.4% on the reports that it would license Gemini to power new features in its latest iPhone software, while Google owner Alphabet Inc (NASDAQ:GOOG) jumped 4.6%.
As per Wedbush, such an agreement is the “missing piece” in Apple’s artificial intelligence strategy, due to materialise with the release of IOS 18 software for its products this year.
Such plans could involve the introduction of an AI App Store, as per Wedbush, alongside the incorporation of new features into the iPhone 16, expected in September.
These may well be among features unveiled by Apple at its Worldwide Developers Conference in June, such as homegrown large language models.
“This is a major win for Google to get onto the Apple ecosystem and have access to the golden installed base of Cupertino,” analysts said in a note.
Indeed, some 2 billion-plus Apple devices are said to currently be in circulation globally, with Wedbush also highlighting a likely “major license fee” attached to the deal.
“For Apple, this will give them the foundation and technology blueprint to double down on AI features currently being developed,” the bank continued.
This should help “make sure that iPhone 16 will be a potential game changer iPhone release around AI functionality”.
Though details of the deal, reported by Bloomberg, are slim, Wedbush said more could be expected before June’s conference, while reiterating an ‘outperform' rating for Apple.