AI

Apple and Amazon are quieter about AI ambitions

Apple reported slumping sales, while Amazon’s retail business is roaring back.
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There’s a generative AI craze sweeping Silicon Valley, but so far, much of the attention has centered on Microsoft, Google, and, to a lesser extent, Meta.

In contrast, Apple’s earnings call this month was mostly bereft of AI buzzwords—the only mentions of the technology came from a brief analyst question toward the end.

And while Amazon CEO Andy Jassy proclaimed in the company’s earnings call that “every single one of our businesses inside of Amazon” has “multiple generative AI initiatives going right now,” the quarterly update was light on specific projects beyond an AI-assisted “coding companion.”

That doesn’t mean Apple and Amazon are sitting out the race to commercialize large language models (LLMs). Bloomberg reported last month that Apple is “quietly” readying a framework called Ajax for the creation of foundation models, as well as an internal chatbot service.

There’s also the question of how each company might integrate LLMs into their respective voice assistants.

Apple’s slumping sales: Apple CEO Tim Cook told Reuters that a jump in research and development spending for the fiscal year was in part related to the tech giant’s funding of AI projects.

That spending came amid a prolonged slump in product sales that has plagued Apple for the last three quarters. The company managed to offset some of that downturn this quarter with growth in its service offerings, which include Apple Music, the App Store, iCloud, and Apple Pay.

“We set an all-time revenue record for total services and in a number of categories, including video, AppleCare, cloud and payment services,” Cook said in the call.

Apple is likely to announce new hardware at its September event, and plans to debut its mixed reality headset, the Vision Pro, starting next year.

Amazon’s rebound: Recent reporting may give a fuller picture of what kind of generative AI projects Amazon has in the works. The Information reported that the company recently rolled out a tool letting sellers generate product descriptions. Job postings Bloomberg spotted earlier this year also indicated that the company may be plotting a ChatGPT-style conversational search experience for its customers.

But Jassy was mostly quiet about the details of projects like these on the call, as Amazon touted a huge spike in profit over the same period last year, as well as an 11% YoY boost in net sales.

The company is looking to generative AI to help turn around its Amazon Web Services cloud business, which experienced declining growth in the last three quarters.

“There’s a lot of new functionality coming out and there’s a lot of spend that will be in this area for all the great solutions that are out there for generative AI and large language models, as well as machine learning solutions that we’ve always had for customers,” Amazon CFO Brian Olsavsky said. “So [we’re] optimistic and starting to see some good traction.”

Keep up with the innovative tech transforming business

Tech Brew keeps business leaders up-to-date on the latest innovations, automation advances, policy shifts, and more, so they can make informed decisions about tech.