In mid-January 2026, Apple announced a multiyear agreement to embed Google’s Gemini large-language models into its Siri and broader Apple Intelligence features. The deal gives Apple access to Google’s tensor processing unit chips, which boast a reported 30% lower cost per inference compared with comparable alternatives. By integrating Gemini across iOS, Apple aims to close gaps in on-device AI and accelerate feature rollouts, potentially influencing purchase cycles for the company’s installed base of over two billion active devices. Analysts estimate that if even 20% of users upgrade their devices to gain full Gemini-powered capabilities, Apple could see a mid-single-digit percentage boost to unit sales over the next 12 months.

Apple’s services business delivered $28.8 billion in revenue in fiscal Q4 2025, a 15% year-over-year increase driven by stronger App Store transactions, advertising sales and cloud services. For the full 2025 fiscal year, services revenue reached $109.2 billion, up 14%, with a segment gross margin of 75.3% versus 36.2% for hardware products. The App Store averaged 850 million weekly users, Apple Pay expanded to over 11,000 bank and network partners across 89 markets, and Apple TV viewing hours climbed 36% year-over-year in December. Management forecasts services growth in fiscal 2026 to mirror or exceed 2025’s rate, positioning the segment as the primary driver of earnings expansion and margin improvement.

Billionaire investor Peter Thiel’s third-quarter filings revealed a sizable addition to his Apple position, even as he exited certain semiconductor and automotive stakes. While Apple shares rose approximately 7% in Q4 2025, some strategists question the timing, noting the company has not introduced a standout hardware innovation in over two years and that its AI roadmap has experienced delays. In parallel, industry analyst Daniel Newman of Futurum suggested that failure to deliver on AI expectations could prompt leadership changes at the executive level. Despite a premium valuation that assumes double-digit earnings growth, investors are watching for tangible product rollouts and adoption metrics to validate the company’s lofty multiple.