Apple, Google Confirm Multiyear AI Deal for Siri and Apple Foundation Models

Alphabet Inc.’s Google has confirmed a multiyear artificial intelligence partnership with Apple Inc., to power the iPhone maker’s next-generation AI models, including the Siri voice assistant. The collaboration will see Google’s Gemini models support Apple’s upcoming Apple Intelligence features and future AI enhancements according to Bloomberg. The companies stated that Apple has concluded a thorough evaluation of AI providers, finding that Google’s technology offers the most capable foundation for its Foundation Models as reported by Yahoo Finance.

The deal is expected to run for multiple years and includes access to Google’s advanced AI models and cloud technology. Google will provide the underlying infrastructure to support a revamped version of Siri, which is set for release this year. This partnership aims to enhance Apple’s AI capabilities while maintaining its high privacy standards according to Reuters.

Apple will continue to process AI services on consumer devices or via its Private Cloud Compute system, ensuring that user data remains protected. The joint statement from both companies emphasized the importance of privacy, a core principle for Apple as Bloomberg reported.

Why Did This Partnership Emerge?

Apple has faced challenges in developing competitive AI features, including delays in the release of its updated Siri. In contrast,

Google has positioned itself as a leader in AI with its Gemini models, which received strong industry feedback. The move reflects Apple’s strategic pivot toward integrating more advanced AI solutions into its ecosystem according to Morningstar.

Analysts have noted that this partnership could mark a significant shift for Apple, which has lagged behind peers in AI development. By adopting Google’s technology, Apple aims to enhance its AI-powered assistant and improve user experience across its product line.

How Did Markets React to the News?

Alphabet’s shares rose by as much as 1.7% following the announcement, while Apple’s stock increased by less than 1%. The market response indicated strong investor confidence in Google’s AI leadership and potential for the partnership to drive long-term value according to Bloomberg.

This partnership also contributed to Alphabet surpassing Apple in market capitalization for the first time since 2019. Alphabet’s market cap reached $3.89 trillion, while Apple’s dropped to $3.86 trillion. The AI-focused momentum for Alphabet has been supported by its Gemini model and expanding cloud infrastructure as Seeking Alpha reported.

What Are Analysts Watching Next?

Analysts are closely observing how this partnership will influence Apple’s product roadmap and AI capabilities. Wedbush analyst Dan Ives has called the deal a necessary step to improve Siri and unlock new revenue streams through AI-driven services. He anticipates an AI-focused subscription offering to be released in 2026.

The collaboration also has implications for Alphabet. With Google’s AI technology now powering one of the world’s largest consumer ecosystems, analysts expect increased validation of Gemini’s capabilities. The move could help Alphabet solidify its position as a leading AI player, alongside rivals like OpenAI and Microsoft according to Bloomberg.

Apple has not yet disclosed the financial terms of the agreement. However, prior reports indicated that the partnership could involve annual payments of around $1 billion. The deal’s long-term value will depend on the success of Apple’s AI features and user adoption rates as Seeking Alpha reported.

Both companies emphasized that the partnership is part of a broader industry shift toward AI integration. With other tech giants investing heavily in frontier models, Apple’s decision to collaborate with Google highlights the competitive pressures in the AI space as GuruFocus reported.

The partnership also aligns with Apple’s ongoing efforts to expand its software ecosystem. As AI becomes a key driver of innovation, Apple’s ability to integrate advanced capabilities into its products will determine its success in the next phase of the tech cycle as GuruFocus reported.

The next major milestone for Apple will be the launch of the revamped Siri later this year. The updated version will be powered by Google’s technology and is expected to introduce new features and capabilities. Analysts will be watching user feedback and performance metrics to gauge the impact of the partnership according to Morningstar.

With the deal now confirmed, investors are looking for further updates on Apple’s AI strategy and how it plans to differentiate itself in the market. The integration of Gemini into Apple’s ecosystem could be a turning point for the company’s AI ambitions and long-term growth trajectory according to Bloomberg.