Apple’s growing AI talent drain has sparked worry about its standing in this burgeoning field. Its most recent setback is the departure of lead AI researcher for robotics, Jian Zhang, for Meta, as announced by Bloomberg. This move is the last link in an ongoing chain of departures from the company's Foundation Models team, reportedly marking the exit of almost 10 members. This team is responsible for Apple Intelligence, the AI system embedded in its devices.
These exits fuel investors' worries that Apple is falling behind its competitors in the AI frontier. The anticipated iPhone 17 launch event next week is expected to do little to dispel these concerns. Notwithstanding, the company promises the event, scheduled for Monday at 1 pm ET, will be 'awe dropping'. Analysts, however, believe the event might center on enhancements that won't significantly alter the company's direction in AI.
Bank of America Analysts indicate that while they are eager to see new AI enhancements, investors' expectations remain relatively subdued ahead of the event, which could devolve into a "sell-the-news" affair. Predictions for the event primarily center around form-factor improvements, including a thinner phone with an improved front camera, and an updated Apple Watch portfolio.
Goldman Sachs and Citi share similar outlooks, with Citi implying that product launches next year could bolster demand, after a series of postponements in eagerly awaited features like an AI-improved Siri. Apple has previously touted these features and an impending AI boom for the company, but that initial enthusiasm has waned as investors await further progress or the possibility of an acquisition to boost Apple's AI competencies.
Bloomberg reported that Apple is currently working on a new AI system, "World Knowledge Answers", slated for launch next year. Plans are underway to incorporate this system into Siri as part of its delayed overhaul, along with inclusion in the Safari web browser.
Apple's stock has been relatively steady, following a nearly 4% gain immediately after a favorable antitrust verdict for Google, which would enable Apple to retain payments for pre-installing Google search products on its devices. However, Apple's shares are still down about 5% for the year, rendering it one of only two “Magnificent Seven” companies, alongside Tesla, showing losses for 2025.