Apple delivered what Wall Street expected: a complete overhaul of artificial intelligence, leveraging Google’s Gemini with a new conversational Siri and updating its internal AI efforts. Apple shares were up more than 3% on Monday afternoon, just before the Siri news was announced at the company’s Worldwide Developers Conference (WWDC). We know it’s not all about one-day stock price movements, but the stock was down more than 1% by the end of the event. Buy rumors and sell news? perhaps. Stocks have been soaring heading into WWDC, with Monday’s trading high hitting another intraday high. Whatever the reason, we’ve seen this type of trading pattern before and after major Apple events. What matters is what Apple announces, not how the fickle market trades its stock. AAPL 1D Mountain Apple 1 Day Siri has been rebuilt. With AI at its heart, personal assistants are more capable and conversational than ever before. In fact, given what we saw on stage, we finally understand that this is an actual personal assistant, not the simple one-response chatbot we’ve known and ignored. This improved, more personalized Siri also extends to AirPods and CarPlay. Models can run both on-device and on private cloud servers, and data is encrypted either on-device or on cloud servers to the point that even Apple can’t access it, increasing privacy. Apple, which has a reputation for innovation as well as user privacy, has everything we’ve come to expect. On-screen recognition allows Siri to better understand requests in context and provide more personalized answers. Users can now ask questions about what they see on screen. System-wide integration means Siri can search all user content based on your request, open apps, and enter information. For example, you can ask Siri to search for images or ask you about recent text message conversations without opening the Photos app. Whatever it is, new data indexing techniques will allow Siri to better track, access, and provide information. Another example: When you ask for directions to a specific location, Siri opens the Maps app and instantly provides directions for your trip. Siri is also coming with third-party app integration, but only time will tell how developers take advantage of the new features. A dedicated Siri app has also appeared. This app not only provides a query history, but also means you can start a conversation on one device and start a conversation on another. This is perhaps the most notable upgrade, allowing deeper levels of research thanks to the ability to continue past conversations with all the context you need to avoid starting from scratch. Although it’s still in its early stages and more features will no doubt arrive over time, WWDC likely lived up to investors’ expectations, with Apple offering new AI-enhanced ways for users to interact with their devices. While past keynotes have been about demonstrators showing you how to use and navigate the operating system, this one was all about asking Siri for the information you need and showing how the AI can do the tedious work of searching for files and folders. With the foundation of Apple Intelligence firmly established, the company believes it is in a stronger position to not only drive AI adoption, but also reap financial benefits. Admittedly, there was a lot of excitement when Apple Intelligence was announced at WWDC 2024, and there was a lot of free-form chatter about “more to come.” While AI capabilities have gradually improved over the past two years, there have been many setbacks, most of which have been the inability to upgrade Siri in any meaningful way until now. But this time, Apple turned to its old search buddy Google. Google’s Gemini AI has emerged as one of the best AIs in the industry. Apple plans to continue developing its own AI models, and in fact announced the second version of its Apple Foundation Models. It’s the best of both worlds. Don’t worry, Apple has the best models in the world. Alphabet, which currently sits near the front of the AI large-scale language model (LLM) pack, could have a hand in that. Rather, the company can focus on its ecosystem and user experience, which it does better than anyone else. The company will also avoid spending billions of dollars on the LLM arms race. By leveraging its large installed user base of devices, Apple can continue to draw more people into its high-margin services business. Given what we saw on Monday, it looks like the AI experience on Apple devices will only get better in the future. Therefore, we would like to reiterate that Apple stock should not be traded, but should be held for the long term. (Jim Cramer’s charitable trust is long AAPL, GOOGL. See here for a complete list of stocks.) As a subscriber to Jim Cramer’s CNBC Investment Club, you will receive trade alerts before Jim makes a trade. After Jim sends a trade alert, he waits 45 minutes before buying or selling stocks in his charitable trust’s portfolio. If Jim talks about a stock on CNBC TV, he will issue a trade alert and then wait 72 hours before executing the trade. The above investment club information is subject to our Terms of Use and Privacy Policy, along with our disclaimer. No fiduciary duties or obligations exist or arise from your receipt of information provided in connection with the Investment Club. No specific results or benefits are guaranteed.
