Apple Forges Billion-Dollar AI Alliance with Google

Apple concluded October by delivering quarterly results that surpassed even the most optimistic market forecasts. The technology giant reported revenue of $102.5 billion with earnings per share of $1.85, comfortably exceeding analyst projections of $101.65 billion. For the full fiscal year, Apple achieved a record-breaking $416 billion in total revenue.

While iPhone sales contributed a solid $49 billion, the standout performance came from Apple's services segment. This division, encompassing App Store, Apple Music, and iCloud, generated $28.8 billion—a 15% year-over-year increase that established a new all-time high. Services are rapidly evolving into Apple's primary profit driver, delivering substantially higher margins than the company's hardware operations.

Strategic Shift in Artificial Intelligence

The most significant development emerged post-earnings: Apple is finalizing a comprehensive artificial intelligence partnership with historical rival Google. Valued at approximately $1 billion annually, this agreement will integrate Google's advanced Gemini AI model into Siri. The collaboration aims to completely reinvent Apple's voice assistant, which has consistently trailed competitors like Amazon's Alexa and Google Assistant. The enhanced Siri is scheduled for launch in spring 2026.

This alliance reveals Apple's strategic approach to the AI competition. Rather than developing large language models from scratch, the company is leveraging established industry expertise through collaboration. Market observers now await evidence whether this substantial investment will enable Apple to close the AI gap or simply represent significant licensing costs without delivering competitive advantage.

Should investors sell immediately? Or is it worth buying Apple?

Confident Outlook Despite Regional Challenges

CEO Tim Cook expressed strong confidence in Apple's trajectory, forecasting that the current holiday quarter will become "the company's best ever and the iPhone's best ever." Management projects revenue growth between 10% and 12%, despite experiencing a 4% decline in Chinese sales during the previous quarter.

Cook anticipates China will return to growth in the first quarter of 2026, driven by robust demand for the upcoming iPhone 17. Current demand for new models already exceeds supply across multiple markets. Simultaneously, Apple continues emphasizing its premium "Pro" device lineup, which delivers superior profit margins compared to standard models.

Investors will receive Apple's next quarterly dividend of $0.26 per share on November 13. With strong financial performance, an ambitious AI initiative, and positive analyst sentiment, Apple positions itself confidently for the coming year.