Alibaba Partners with Apple on AI Development for iPhone Users in China
Alibaba's stock sees a significant rise following news of a collaboration with Apple to enhance AI features in China.
Apple Inc. is collaborating with Alibaba Group to develop artificial intelligence features aimed at enhancing the iPhone user experience in China, according to a report by The Information cited by Reuters.
The two companies have submitted their co-developed AI features to China's cyberspace regulator for approval.
In response to this news, Alibaba's shares listed in Hong Kong rose by 8 percent, closing at 113.3 Hong Kong dollars on Wednesday, while shares of Apple increased by 2 percent in the previous trading day.
Previously, Apple had chosen Baidu as its primary partner for AI development; however, it was reported that Baidu's progress did not meet Apple's standards.
Following this, Apple evaluated potential partnerships with several companies, including Tencent, ByteDance (the parent company of TikTok), Alibaba, and Deepseek.
Ultimately, Apple decided against partnering with Deepseek, citing its team’s limitations in manpower and experience suitable for larger customer bases.
The introduction of AI capabilities is deemed essential by Apple, particularly as the company experienced a decline in iPhone sales during the holiday quarter, a key sales period, attributed in part to the absence of advanced AI features that were anticipated to be a significant selling point.
Apple has projected strong sales growth for the upcoming quarter, which has led to optimism regarding a potential rebound in iPhone demand.
According to The Information's report, Apple's choice to partner with Alibaba was influenced by the extensive amount of personal data that Alibaba possesses regarding users' shopping and payment behaviors, which is expected to aid in training AI models and delivering tailored services to consumers.
As of now, neither Apple nor Alibaba has provided comments in response to queries from Reuters regarding this partnership.
The two companies have submitted their co-developed AI features to China's cyberspace regulator for approval.
In response to this news, Alibaba's shares listed in Hong Kong rose by 8 percent, closing at 113.3 Hong Kong dollars on Wednesday, while shares of Apple increased by 2 percent in the previous trading day.
Previously, Apple had chosen Baidu as its primary partner for AI development; however, it was reported that Baidu's progress did not meet Apple's standards.
Following this, Apple evaluated potential partnerships with several companies, including Tencent, ByteDance (the parent company of TikTok), Alibaba, and Deepseek.
Ultimately, Apple decided against partnering with Deepseek, citing its team’s limitations in manpower and experience suitable for larger customer bases.
The introduction of AI capabilities is deemed essential by Apple, particularly as the company experienced a decline in iPhone sales during the holiday quarter, a key sales period, attributed in part to the absence of advanced AI features that were anticipated to be a significant selling point.
Apple has projected strong sales growth for the upcoming quarter, which has led to optimism regarding a potential rebound in iPhone demand.
According to The Information's report, Apple's choice to partner with Alibaba was influenced by the extensive amount of personal data that Alibaba possesses regarding users' shopping and payment behaviors, which is expected to aid in training AI models and delivering tailored services to consumers.
As of now, neither Apple nor Alibaba has provided comments in response to queries from Reuters regarding this partnership.
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