Apple may need to acquire AI firms to boost Apple Intelligence
Financial firm Wedbush believes that WWDC practically demonstrates how Apple is executing its Apple Intelligence strategy, but without significant progress it may be forced into large scale AI acquisitions.
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Most investment and financial firms were underwhelmed by Apple's WWDC 2025 keynote, and that includes Wedbush. But in a note to investors seen by AppleInsider, Daniel Ives at Wedbush says that Apple did lay out its vision for AI, and it has begun to execute that with it opening up Apple Intelligence to third-party developers.
The analyst argues that Apple chose to play things safe, and even low-key, following what it and others describe as the missteps of WWDC 2024. Yet while that strategy is supportable and maybe even necessary, Ives maintains that the following 12 months are critical for Apple Intelligence.
Specifically, he reasons that progress in Apple Intelligence will be the focus of investors during that next year, so the company has only a short time to impress them. He says that this time pressure could prompt Apple to make bigger AI Acquisitions than the many small ones it already has.
Apple has always acquired very many companies each year, but only reveals this when required to because of the size of the deal. The company may have made many more AI acquisitions than known, then, but so far it's been reported to buy such firms for calendar features, and manufacturing.
There is no indication of what further AI acquisitions might satisfy the analysts's expectation, but Ives says that Wedbush is highly confident that Apple can do it well. He says that WWDC 2025 may have lacked the same AI push that 2024's event did, but that it also set the stage for significant improvements to come.
Consequently, Wedbush is retaining its $270 price target.
The company raised that target to $270 in May 2025. At the time, this was less about Apple Intelligence, and more on Apple's ability to mitigate global disruptions such as Trump's tariffs.
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Comments
It is important to remember that generative AI 'hallucinates' by design not only as some weird by-product.
Methods are being used to make hallucinating less of an issue. Not that it is, even now, for people who understand the limits of AI today.
We can still do things today that were unimaginable just a couple of years ago so it's key not to flag the moments AI 'fails' but to appreciate the benefits it brings most of the time.
If it weren't proving successful, people would have pulled away already. They haven't.
In 2023, Apple deliberately chose not to even utter the letters 'AI' at WWDC2023.
In hindsight that was a mistake as it brought more questions than answers.
In 2024, and amidst the start of the Gen AI boom, Apple chose to make a meal out of AI. In hindsight that was probably an error too but understandable at least.
In 2025, people are again asking questions and the answers aren't very convincing. The pressure is really on now (both internally and externally).
2026 looks like being a crunch year for a few reasons.
Acquisitions are fine but nothing they purchase today can just be patched into its systems in real time and major acquisitions are obviously going to make things look worse from a strategic perspective. That makes 2026 an important year.
However, things are moving so incredibly fast right now that it is hard to predict where things might be even at Christmas this year. That applies to everyone but if you have a shipping product to 'sell' at least you're on the train.
It's not hard to imagine Apple still struggling in 2026. We know (with some guesswork sprinkled in) that Apple has had important management issues that have led to delays. Siri (and everything that hangs off it) is a classic example.
I think Apple is just spread too thin at the moment. An acquisition might ease that situation. Just like the Intel modem acquisition brought in a thousand engineers and the project reached the market.
Apple is unlikely to arrive with a more reliable system because competing systems already exist and are moving ahead.
That said, I never put much into what financial analysts say.
When nobody investor firms are squawking about "pie in the sky" futures with AI
You need a leader at the top that tells it like it is. Businesses are looking to leverage
AI and most of the companies with heavy financial expenditure in AI have big
business in mind. Apple is primarily focused on the residential sector and this sector
will always trail businesses' needs with scaled down and simplified product and service
selections. Apple doesn't need to acquire any large firms they just need to clean up
their business processes and realize that their marketing message and company behavior
has been weak and tepid. They have lost the edge that Jobs worked hard to bring to Apple
because Tim Cook is not that guy.
Apple's problem really is with their senior management's failure of vision and strategy. Either senior management needs to self-correct or the board will have to get involved.
Apple was right in not giving OpenAI or anyone else billions of dollars for AI software, which is currently a work in progress …..
https://en.wikipedia.org/wiki/Apple_silicon
https://en.wikipedia.org/wiki/MacOS
According to K-10 filing, Apple describes themselves as a design company. Apple designs, manufactures, and markets etc.
So. I have always considered Apple Silicon as their own design IP. Somehow, you are also right, that is is a vertical company.
Additionally, it is also a lesson learned move from Apple that an exclusive agreement could get eyed by the court sooner or later (Google Search as an example).