5Upper IntermediateBusinessTechnology

Apple Shifts Its AI Strategy Toward Hardware and Services

Apple has reportedly changed its artificial intelligence approach, choosing to focus on hardware and its App Store rather than competing directly with AI leaders. This platform-based strategy could reshape how millions of users experience AI on their devices while keeping Apple profitable.

2 min readLevel 5March 31, 2026

By Flalingo Editorial Team

Vocabulary

Study these words before reading the article. Click the audio button to hear pronunciation.

strategic

/strəˈtiːdʒɪk/

adjective

Relating to a long-term plan designed to achieve a particular goal or advantage

“The board approved a strategic plan to expand into new markets over the next five years.”

infrastructure

/ˈɪnfrəstrʌktʃər/

noun

The basic systems and structures that an organization or country needs to operate, such as buildings, equipment, or technology

“The government invested heavily in digital infrastructure to support economic growth.”

commoditized

/kəˈmɒdɪtaɪzd/

adjective

Turned into something widely available and interchangeable, so that price becomes more important than uniqueness

“Cloud storage has become commoditized, making it hard for companies to charge high prices.”

foundational

/faʊnˈdeɪʃənl/

adjective

Serving as a base or essential part that other things are built upon

“Strong communication skills are foundational to success in any business career.”

revamped

/riːˈvæmpt/

adjective

Improved or redesigned to make something more effective or modern

“The company launched a revamped website to attract more online customers.”

reserves

/rɪˈzɜːvz/

noun

Money or resources that are kept available for future use or emergencies

“The firm's large cash reserves allowed it to survive the economic downturn without borrowing.”

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Article

Click on any underlined word to see its definition. Highlighted words are from the vocabulary section.

Apple is changing how it approaches artificial intelligence. According to Bloomberg, the company is recommitting to its core business model. Instead of building advanced AI models, Apple will focus on hardware and services. This strategic shift could affect how millions of people use AI daily.

The company's new approach resembles its successful App Store strategy. Apple plans to let third-party AI providers operate on its devices. It would collect revenue from these services, similar to app commissions. Apple reportedly earned nearly $900 million from AI apps in 2025 alone. Rivals like Google and Meta are spending hundreds of billions on AI infrastructure.

Some analysts believe this cautious approach could prove beneficial in the long run. Apple holds over $130 billion in cash reserves. If AI models become commoditized, owning expensive infrastructure may offer little advantage. The company has partnered with Google's Gemini to power a revamped Siri. This partnership lets Apple avoid massive spending while still delivering AI features.

However, some industry commentators have raised concerns about this strategy. Bloomberg's Mark Gurman argued that AI is becoming foundational technology. He suggested it is not simply a service like web search. If Apple does not invest enough in AI, it could risk falling behind permanently. The coming months will reveal whether this platform approach can truly succeed.

Comprehension Quiz

Test your understanding of the article with these multiple-choice questions.

1
What is Apple focusing on instead of building its own advanced AI models?
2
How much did Apple reportedly earn from AI apps in 2025?
3
Which company's AI technology will power the revamped Siri?
4
Why do some analysts think Apple's cautious approach could be beneficial?
5
What did Mark Gurman argue about AI in relation to Apple's strategy?

Discussion

Answer these comprehension questions about the article.

1
What is Apple's new approach to artificial intelligence according to the article?
2
How does Apple's AI strategy compare to the strategies of its main competitors?
3
Why did Apple earn nearly $900 million from AI apps in 2025?
4
What concern did Bloomberg's Mark Gurman raise about Apple's platform approach?
5
How does Apple's partnership with Google's Gemini help the company avoid large spending?

Further Discussion

Share your opinions on these open-ended questions.

1
If you were an Apple executive, would you invest more in building your own AI models or continue the platform approach? Why?
2
Do you think companies that spend less on new technology can still remain competitive in the long term?
3
How might Apple's strategy affect smaller app developers who create AI-powered tools?
4
In your industry, have you seen examples of companies succeeding by letting others build on their platform?
5
If AI models truly become commoditized, which companies do you think would benefit the most and why?