Many companies across the tech landscape are jumping full steam ahead into the artificial intelligence (AI) race, investing gargantuan amounts of capital to build IT infrastructure. By comparison, Apple (NASDAQ:AAPL) adopts a cautious approach; It is capital expenditure totaled $12.7 billion in fiscal year 2025 (ended September 27).
Critics have criticized the consumer tech company for being late, as it hasn’t really introduced any groundbreaking AI features, with its AI-powered Siri being delayed. Regardless of how things play out, I predict that Apple’s dominance will not fade in the AI era.
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About a year ago, CEO Tim Cook revealed that there were 2.35 billion active Apple devices worldwide. Since then, in the quarters, he mentioned that this installed base continues to reach new records. Since the iPhone accounts for half of product revenue, a rough assumption leads to a conservative estimate that there are more than 1 billion active iPhones.
This gives Apple an incredible distribution advantage. It is literally in the pockets of a large number of consumers in virtually every corner of the world. And the fact that the iPhone is almost two decades in its life cycle confirms its relevance in the future. It has stood the test of time.
Over the next decade, advances in AI could prove to change civilization, or introduce marginal improvements. Nobody knows for sure. It might be reasonable to fall somewhere in between.
Lots of praise for OpenAI ChatGPT as it reached 100 million users two months after its release, faster than any other consumer app in history. But it is important to understand that using the chatbot does not require consumers to purchase new hardware. There was little friction getting on board and testing it.
No matter how optimistic you are about the potential of AI, it’s hard to imagine a future in which the smartphone in general, and the iPhone in particular, won’t still be the most important device people carry with them because it serves as our primary window into all things digital and the internet. For what it’s worth, Apple is working on a wearable AI pin. OpenAI hopes to launch its own product in late 2026.
