Apple’s AI Gamble Pays Off: Stock Soars, Nears Microsoft’s Value

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Apple’s stock surged over 7% on Tuesday, hitting a record high and inching closer to overtaking Microsoft as the world’s most valuable company. This spike followed Apple’s unveiling of new artificial intelligence (AI) features at its annual developer event, sparking optimism about a potential rebound in iPhone demand.

Despite lagging behind the S&P 500 in 2024 due to slowing iPhone sales and concerns regarding its AI strategy, Apple’s latest announcements seem to have allayed investor concerns. The company showcased a vastly improved Siri virtual assistant with expanded capabilities and introduced several AI-driven features across its operating systems.

Closing at $207.15 per share, Apple’s market capitalization reached $3.18 trillion, narrowly trailing Microsoft at $3.22 trillion but surpassing AI chip giant Nvidia at $2.97 trillion. This close competition highlights the fierce rivalry among tech giants vying for market supremacy.

Analysts responded positively to Apple’s revelations, with at least 13 raising their price targets for the company’s stock. Many anticipate that these new AI features could trigger a wave of upgrades and new purchases when Apple launches its next generation of iPhones in the fall.

Gartner analyst Tuong Nguyen commented, “Apple is showing its commitment to advancing its platform and devices to facilitate the next era of computing, interfaces, and experiences.” This sentiment reflects a growing confidence that Apple is actively positioning itself as a key player in the swiftly evolving landscape of AI.