Alphabet and Apple agreed to a multi-year deal to use Google’s Gemini AI. Google’s models will power Apple’s “Apple Intelligence” features, including the revamped Siri, launching this year.
“After careful evaluation, Apple determined that Google’s AI technology provides the most capable foundation for Apple Foundation Models,” Google said in a statement. “Apple Intelligence will continue to run on Apple devices and Private Cloud Compute, while maintaining Apple’s industry-leading privacy standards.”
Alphabet shares rose after the announcement and the company’s market cap briefly topped $4 trillion. Alphabet joined Apple, Microsoft, and Nvidia as firms that have exceeded the $4 trillion mark.
“This is what the Street has been waiting for,” said Wedbush Securities analyst Daniel Ives, who called the news a validation for Google. He set an outperform rating on Apple with a $350 12-month target, while BofA Securities reiterated a buy rating with a $325 target (Ed. note: Analysts expect Apple to introduce its AI-enabled Siri in March or April).
