Apple and artificial intelligence: How will this change the geopolitical scene?

The marriage between Apple and artificial intelligence heralds a technological revolution with major geopolitical repercussions. How will this alliance redefine the balance of power on a global scale? Let’s discover together the issues and challenges of this new era where technology now dictates the rules of the game on the international scene.

Apple’s power in the global market

Apple is not a company like any other. It is often referred to as « mega action » due to its exceptional market capitalization. For comparison, the height of its value is often put into perspective with the GNP of entire countries. In June 2023, Apple reached a capitalization of 3 trillion USD, a level that few companies can even dream of reaching. This situation recalls that of the industrial barons of the early 20th century, such as Rockefeller And Vanderbilt.

However, in this race for value, Apple is not alone. Microsoft And Nvidia are two of its main competitors, with respective market capitalizations of 3.2 trillion USD and a new peak of 3.8 trillion USD. It is essential to note the importance of the competitive ecosystems in which these technology giants operate.

Geopolitical and economic challenges

International relations and geopolitical issues have a significant impact on Apple. The company has traditionally outsourced a large part of its production in China, a key market for its products likeiPhone. However, the US-China trade war, initiated by Trump and intensified by Biden, has strained Apple’s supply chains. Although efforts are underway to transfer production toIndia and the Mexico, this transition represents a major challenge.

Another crucial aspect is the production of the chips Nvidia by Taiwan Semiconductors. China, with its ambitions over Taiwan, represents a significant geopolitical risk for this supply chain. This raises questions about the security of sources of critical components for Apple products.

The impact of artificial intelligence

Artificial intelligence (AI) constitutes another dimension of competition between technological giants. Microsoft And Nvidia have taken the lead in integrating the computing capabilities of GPUs into various AI applications. Apple, on the other hand, needs to catch up technologically with Broadcom as main partner.

Apple announced its commitment to work on AI inference, a critical component of post-training machine learning. The CEO of Apple, Tim Cook, has promised major announcements at the next Worldwide Developers Conference, indicating that the company is far from abandoning this technological race.

Sanctions and competition

Apple also faces regulatory challenges. The United States and the European Union have stepped up sanctions against the practices anti-competitive of big tech, specifically targeting the limitations imposed on services like Spotify.

These sanctions may affect Apple’s dominant position in the global technology market, especially as it faces increasing competition from Microsoft And Google in various sectors, including IT and smartphones.

Financial growth prospects

Profit forecasts for Apple are more pessimistic than those of its big tech competitors. Since September 2023, we have observed stagnation, or even a downward revision, of profit expectations.

However, growth of almost 50% is anticipated by 2028, or around 10% per year. This conservative estimate could understate the company’s potential in the context of the AI ​​revolution.

The importance of Apple as a technological stock

With a massive market capitalization, Apple remains a key stock in investors’ portfolios. Its financial liquidity involves limited diversifiable risk and higher quality financial signals compared to other stocks.

Apple can therefore be overweighted in an investment portfolio, serving as a « father of the family » stock and portfolio base for those who can manage exposure based on market cycles.

Edouard, 37 years old, Machine learning

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