Apple delays AI upgrades as stock drops 1.2% at WWDC

Apple’s latest Worldwide Developers Conference revealed a company taking a notably cautious approach to AI integration, with executives acknowledging that promised Siri upgrades need “more time to reach our high-quality bar.” This measured stance contrasts sharply with competitors rushing AI features to market, positioning Apple as potentially the only major tech company prioritizing reliability over rapid deployment in the AI race.

What you should know: Apple’s WWDC 2024 focused primarily on visual updates rather than the AI breakthroughs investors expected.

• The company’s stock fell 1.2% during Monday’s event, reflecting disappointment over the lack of substantial AI progress.
• Craig Federighi, Apple’s software engineering chief, admitted the enhanced Siri features promised last year still aren’t ready: “This work needed more time to reach our high-quality bar, and we look forward to sharing more about it in the coming year.”
• The buzziest element was “Liquid Glass,” a visual design update described as “gloopy” and shapeshifty, though hardly groundbreaking.

The big picture: Apple’s deliberate approach to AI development appears increasingly strategic as the technology continues to face reliability challenges across the industry.

• Apple’s own researchers published a paper Friday showing that advanced AI models face “complete accuracy collapse” when presented with complex problems.
• The company previously had to roll back AI-powered text message summaries due to performance issues.
• Apple’s core brand promise centers on products that “work and people like it” — qualities that generative AI systems still broadly lack.

Why this matters: Apple’s cautious AI strategy could prove prescient as the technology fails to meet many of its biggest promises.

• Gary Marcus, an AI industry critic, wrote that “anybody who thinks LLMs are a direct route to the sort (of artificial general intelligence) that could fundamentally transform society for the good is kidding themselves.”
• Apple has historically succeeded by perfecting existing technologies rather than pioneering new ones, dominating categories like smartwatches and tablets despite arriving later than competitors.

What analysts are saying: Tech experts view Apple’s restraint as both prudent and potentially problematic for investor expectations.

• “Cupertino is playing it safe and close to the vest after the missteps last year,” wrote Dan Ives of Wedbush Securities, a financial services firm.
• Ives suggested Apple “may be forced into doing some bigger AI acquisitions to jumpstart this AI strategy.”
• Despite concerns, Ives maintained confidence: “We have a high level of confidence Apple can get this right. But they have a tight window to figure this out.”

Market context: Apple’s stock has declined 17% this year as the promised AI “super-cycle” of iPhone upgrades failed to materialize following last year’s Apple Intelligence announcements.