At the Worldwide Developers Conference (WWDC) on June 10, Apple announced the birth of Apple Intelligence and stated that it will be deeply integrated into iOS 18, iPadOS 18 and macOS Sequoia based on the generative artificial intelligence (AI) model in personal scenarios, which can realize cross-app operations, writing improvements, image generation and other functions to simplify and speed up daily task processes for users. For a time, Apple attracted the attention of global investors and also aroused many doubts. After all, the iPhone has repeatedly performed poorly in the most critical Chinese market, and sales have repeatedly declined. Can Apple Intelligence, which Apple has high hopes for, become a new driving force for Apple's growth?
The latest progress of Apple Intelligence landing
On July 29, Eastern Time, Apple released the first version of Apple Intelligence, iPhone AI. There are similar versions for iPad and Mac. In summary, this version has the following features:
- Paid use: Since the new software is first released only in the developer beta of iOS 18.1, only registered developers who have paid $99 can use this iOS 18.1 beta.
- Model restrictions: Only applicable to iPhone 15 Pro and iPhone 15 Pro Max, currently only these two iPhone models support Apple Intelligence.
- Access restrictions: After updating iOS, users must enter the Settings app on their iPhone, click the new Apple Intelligence menu, and then click "Join the waiting list", that is, complete the waiting list registration in the Settings app, before they can access the Apple Intelligence service.
Apple Intelligence Update Features
The first batch of Apple Intelligence features include:
- Rewrite text: Users can summon AI to rewrite, proofread and summarize text in almost any scenario, including Mail, Notes, Pages documents and various third-party apps.
- Siri upgrade: Siri can provide users with device support everywhere, understand the continuous requests and instructions between two questions of the user, and maintain the context from one request to the next. At the same time, this Siri will be able to understand what the user's app wants to do and operate on behalf of the user. For example, when a user receives a new address from a friend in the Messages app, he only needs to say "add this address to his contact card" and Siri will do it for him.
- Automatic summary: The Memos app and the Phone app allow users to record audio, transcribe audio into text, and generate content summaries. When the recording function is turned on during a call, both parties on the call will automatically receive a prompt. After the call, Apple Intelligence will generate a content summary to help users review the key points of the call.
- Image creation: Apple Intelligence can create photos based on the user's photo library. Users can create images in seconds. There are three styles to choose from: sketches, illustrations, and animations. All images are created and generated on the device side. Users can try as much as they want without being limited by the number of images; this function is built into multiple apps such as Messages. Users can share their own images with friends and see personalized creative recommendations generated based on the current conversation.
- Integration of ChatGPT: Apple said that it is integrating ChatGPT into the operating experience of iOS 18, iPadOS 18 and macOS Sequoia, allowing users to directly use the special features of ChatGPT, saving users the trouble of switching back and forth between different tools. Siri can directly call the special features of ChatGPT as needed. It will send the user's question to ChatGPT, along with any documents or photos, and finally reply to the user directly after obtaining the user's consent.
Can Apple Intelligence help Apple increase revenue?
On August 1, Eastern Time (early Friday morning Beijing time), Apple will release its third quarter of fiscal year 2024 (second quarter of the natural year 2024) financial report. Considering that Apple has suffered five quarters of revenue decline in the past six quarters, the financial report to be released on Friday is crucial to Apple's stock price. After all, Apple has used the trump card of Apple Intelligence.
Wall Street generally has confidence in Apple's second-quarter financial report. Apple's second-quarter GAAP revenue was US$84.48 billion, a year-on-year increase of 3.3%. Wall Street expects Apple's adjusted earnings per share to be $1.35 in the second quarter, up 7.4% year-on-year, much higher than the 0.7% in the first quarter. As the largest source of Apple's revenue, iPhone sales were 38.95 billion yuan, down 1.8% year-on-year, a much narrower decline than the first quarter (down 10.5% year-on-year).
JPMorgan Chase expects Apple's second-quarter iPhone and total revenue to exceed market expectations, and Apple's replacement cycle will proceed smoothly. Apple's active layout of artificial intelligence may push its stock price to new heights. In a research report released last week, JPMorgan analysts such as Samik Chatterjee included Apple in the "Positive Catalyst Watch" list and expected its stock price to rise to $245 by the end of this year and further to $265 by the end of 2025, 12.4% and 21.6% higher than Friday's closing price, respectively.
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