Key Points

• It is reported that Apple hopes for Siri to become more autonomous by 2027.
• Investors assess Apple's AI ambitions, AAPL driving stock prices up
• Google and OpenAI pose different challenges to Apple's strategy

It is reported that Apple is preparing to turn Siri into an autonomous artificial intelligence agent, enabling it to complete tasks without the need for users to give instructions at every step, which could intensify competition with OpenAI and Google.

According to a report on November 8th, CEO John Ternus ( John Ternus ) has urged software director Craig Federighi ( Craig Federighi ) to accelerate the development of Apple's ( AI ). The company may launch more autonomous ( Siri ) features as early as 2027, although the release date has not yet been confirmed.

Apple's ( NASDAQ : AAPL ) stock price rose by about 2% in the morning session on Monday, approaching $350; it closed at $342.37 last Friday. However, this trend cannot be entirely attributed to reports related to Siri, especially considering Apple's recent performance that exceeded expectations and the significant volatility in its stock price.

Apple hopes that Siri will compete with autonomous AI agents.

Apple's next ambition is not just to enhance the conversational capabilities of Siri. Reports suggest that the company hopes this assistant will be able to track targets, decide on subsequent actions, and continue to work without the need for repeated user prompts.

This will be a major expansion for Siri AI. Siri currently already supports personal context, screen awareness, and the ability to perform actions across Apple applications.

In its developer announcement on November 3rd, Apple introduced broader integration with third-party applications in the iOS 27.3 beta version. Developers can build features that involve reservations, place orders, and multiple linked actions, but broader consumer availability is still to be rolled out.

This progress brings Apple one step closer to the emerging market of autonomous assistants, and OpenAI as well as other competitors are also moving in this direction from traditional chatbots.

However, greater independence also brings challenges in terms of permissions, privacy, and reliability. Previous proxy events of OpenAI have shown that the safeguards required to enable the AI system to take action must be stronger than those needed simply for generating answers.

Google's collaboration brings about unusual competitive dynamics.

There is an important contradiction in Apple's AI strategy: Google is both a technology provider and a competitor.

According to the agreement reached by both parties in January, Apple's next-generation base model will utilize Google's Gemini technology to help drive the redesigned Siri.

This arrangement allows Apple to expand its AI capabilities without necessarily having to match Google's infrastructure investments, but it also raises a question: how much technical independence can Apple still retain?

This approach stands in contrast to the broader AI spending competition. Previously, when Apple adopted a relatively restrained infrastructure strategy, its market value reached $5 trillion.

Can autonomous Siri enhance Apple's stock price?

For investors, the financial opportunity lies in making Apple devices more valuable, rather than necessarily creating a brand-new AI source of revenue.

Apple announced that its revenue in the fourth quarter of fiscal year 2024 was $114.5 billion, a year-on-year increase of 12%; service business revenue reached a record $31.6 billion. Its continuously expanding ecosystem provides a ready-made distribution platform for the more powerful AI software.

Autonomous assistants may enhance customer retention and drive upgrades, thereby reinforcing the potential for iPhone replacement cycles that Morgan Stanley has previously emphasized.

However, profitability remains important. Apple expects its gross margin for the December quarter to be between 45% and 46%, which is lower than the previous 47.9%. The reason is that rising component costs are threatening the profitability of its hardware business.