Ives: Apple needs to buy Perplexity

Dan Ives has a short message for Apple’s leadership: time’s up.

The Wedbush Securities analyst released a note today saying that Apple CEO Tim Cook needs to “rip the band-aid off” and make a big move to shake up the AI race. Ives added that Apple has long opted to hang back and take its time to enter a new space, preferring to build its own uniquely Apple take on new tech.

But Ives thinks that Apple has made some serious stumbles, and that playbook is not going to work for this feverish AI race:

“Cook & Co. tried internally to build out Apple Intelligence and after a disappointing black eye moment, this year’s WWDC was a snoozer with AI basically absent... which massively disappointed investors and most importantly developers. Covering Apple for many years we understand the DNA well in Cupertino and there is a belief they can develop anything internally better at Apple Park that an outside acquisition will give them; unfortunately we believe those days are gone... the time has come Apple needs to acquire Perplexity to significantly boost its AI platform.”

Last quarter, Apple said it had $133 billion in cash, so splurging $30 billion or so for Perplexity (reportedly valued at $14 billion) would be easy, Ives said.

Apple just lost a top AI executive to Meta, which is doling out massive deals to lure top talent for its recent push for a “superintelligence” team of all-stars.

An acquisition like Perplexity could help the iPhone maker reinvigorate its Siri voice assistant, which is currently stuck in limbo.