Apple did not spend huge amounts of money on AI, unlike other big tech companies.

The need to increase investments in the development of artificial intelligence forced Apple management to admit at the quarterly reporting conference that costs in this area had already begun to increase in the last quarter, but the financial indicators available to the public allow us to speak of Apple’s relatively modest costs in this area compared to most competitors.

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According to CNBC, last quarter Apple reported a 3% year-over-year increase in real estate and equipment costs to $2.15 billion, and an 8% sequential increase in those costs compared to the previous quarter. Some of these investments, presumably, had nothing to do with artificial intelligence, but even this value of the absolute amount is enough to argue that Apple’s expenses on creating infrastructure for AI are quite modest. The company’s management explained that it prefers to adhere to a hybrid approach to the construction of data centers, relying on renting ready-made facilities from third-party providers.

Microsoft, by comparison, incurred $13.87 billion in capital expenditures last quarter, up 55% year over year. Alphabet’s core expenses rose 91% to $13.19 billion, and Meta✴ Platforms saw its capital expenditures rise 31% year-on-year to $8.3 billion. The latter’s founder, Mark Zuckerberg, recently justified the growth during a speech profile costs with a higher risk of losing the company’s position in the AI ​​segment compared to possible financial losses from wasted investments. He sees Apple as a strong competitor, and this time he doesn’t want to let it control the bulk of the market during this important technological transition. If you don’t invest heavily now, as Zuckerberg explained, you could fall behind other market participants by at least 10 or 15 years.

Apple’s desire to avoid buying and renting expensive Nvidia accelerators also helps reduce Apple’s costs for developing AI systems. She, as has recently become, prefers to rely on Google processors. CEO Tim Cook explained at Apple’s quarterly conference that a hybrid approach to developing AI infrastructure allows the company to allocate capital costs to the budget of cloud service providers. Such partners of Apple are Amazon, Google and Microsoft. The latter finances the development of OpenAI, with which Apple itself cooperates in the integration of the ChatGPT chatbot and the Siri voice assistant. Apple representatives this week declined to talk about the details of the agreement with OpenAI, citing confidentiality. Tim Cook does not exclude that some opportunities for monetization will appear in this area.