Tim Cook confirms Apple will spend more on AI, may acquire to catch up

Tim Cook

Apple is finally turning up the volume on AI—and Wall Street’s listening. On its Q3 earnings call, the company reported a 10% year-over-year revenue jump but spent more time talking about the future: artificial intelligence. CEO Tim Cook said Apple is “significantly” increasing its investment in AI and has already acquired around seven companies this year—some, though not all, AI-related.

While Apple didn’t name the firms, Cook stressed it isn’t picky about size: “We are not stuck on a certain size company,” he said, reaffirming openness to M&A if it helps accelerate the AI roadmap.

Apple’s capital expenditure tells a more modest story. Its June quarter spend was $3.46 billion, the highest since late 2022—but still a fraction of what rivals are shelling out. Google is projecting a mammoth $85 billion for 2025, Meta up to $72 billion, and Microsoft a hefty $30 billion this quarter alone. Apple, by comparison, looks conservative—at around $14 billion annually, if current pace holds.

But Apple’s approach differs. It’s not building a public cloud to rent out AI infrastructure. Instead, it’s quietly deploying its own Private Cloud Compute stack, powered by in-house silicon rather than Nvidia chips. CFO Kevan Parekh clarified that many of Apple’s AI investments are recorded as operating rather than capital expenses, due to its “hybrid” model that leans on partner infrastructure.

Internally, Apple is also reshuffling talent to prioritise AI features. And while competitors are pitching all-new AI-first devices, Cook played defence: “It’s difficult to see a world where iPhone’s not living in it,” he said. He believes future AI devices will be complementary, not replacements.

In typical Apple fashion, the company stayed vague on some details—declining to weigh in on the commoditisation of large language models, for example. But Cook made the strategy clear: Apple’s flavour of AI will be “deeply personal, private and seamlessly integrated.”