Alphabet (NASDAQ: GOOGL) stock surged over 4% Monday on reports of discussions with Apple (NASDAQ: AAPL) to integrate Google’s Gemini AI products into future iPhone operating systems. However, the stock dropped modestly in the opening hours of Tuesday.
Apple (AAPL) and Google (GOOGL) are in talks for licensing, Bloomberg reports. The report revealed that Apple was also discussing similar matters with OpenAI, the creator of ChatGPT.
Tim Cook, the CEO of Apple, has previously disclosed to investors the company’s active involvement in AI projects. In addition, recent reports suggest that Apple has acquired companies as part of its strategy to bolster its presence in the AI space.
Bloomberg reports that Apple plans to incorporate AI-powered features developed in-house into iOS 18, its upcoming operating system. However, more extensive AI tasks such as long text or image generation might involve licensing from another company.
Earlier revelations last summer suggested that Apple had initiated its AI endeavors under the project name Ajax. This endeavor includes the development of its proprietary large language model (LLM), which serves as the backbone for chatbots such as ChatGPT and Gemini.
Apple and Google have an existing agreement wherein Google serves as the default search engine on Apple devices. This arrangement has previously faced scrutiny from antitrust regulators.
While Apple and potential AI partners negotiate, Bloomberg suggests that Apple may withhold any formal announcement regarding this collaboration until its annual Worldwide Developers Conference (WWDC) in June.
Analysts at Wedbush view this potential collaboration as a significant boon for Google, potentially providing Apple with a robust foundation and technological blueprint to bolster its AI offerings.
Alphabet (NASDAQ: GOOGL) Stock Reaction
GOOGL stock jumped 4.60% to close at $147.68 on Monday. The traders had exchanged hands with 69,273,696(69.27 million) shares compared to the average daily trading volume of 31.37 million.
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