apple r&d up 34%, beating google and meta: what's cooking

apple is increasing its r&d budget 34%. what are they developing?

for comparison: google, microsoft, meta, and amazon grew their r&d by 29% on average. apple beat them all. the company everyone called "behind on ai" is now spending faster than the giants

what they're working on:

- on-device ai (running models on your iphone instead of the cloud)
- agentic ai on apple's own chips
- a much smarter siri this year
- privacy tools to make it all work

apple is also training its own ai models and designing chips just for ai

here's the twist: apple's spending on data centers is actually down – $4.3b over two quarters vs ~$6b a year ago. meanwhile google, microsoft, meta, and amazon together spend hundreds of billions on data centers. apple is leaning on google's gemini to cover the gap

so the 34% jump isn't going to data centers. horace dediu (asymco) thinks it's going to talent, teams, and experiments in training and modeling. in other words: apple is investing in ai people and research, not ai infrastructure. a very different bet than microsoft or meta

apple's bet: ai moves from the cloud onto your device. and owning the chip, the os, and a billion iphones is the winning hand