Is Apple finally ready to buy big in the AI race? Tim Cook is ready to pay
During the company’s Q3 2025 earnings call, CEO Tim Cook suggested that Apple is open to larger mergers and acquisitions if the right opportunity arises, particularly in AI.
- Aug 1, 2025,
- Updated Aug 1, 2025 1:11 PM IST
Apple may be ready to break from its long-standing frugal tradition as it races to catch up with rivals in the artificial intelligence space. During the company’s Q3 2025 earnings call, CEO Tim Cook suggested that Apple is open to larger mergers and acquisitions (M&A) if the right opportunity arises, particularly in AI.
Responding to a question from Citi analyst Atif Malik on whether Apple needed to fast-track its AI roadmap despite not traditionally making large acquisitions, Cook clarified that company size is not a constraint. “We’re very open to M&A that accelerates our roadmap,” Cook said. “We’re not stuck on a certain size company. We basically ask ourselves whether a company can help us accelerate a roadmap. If they do, then we are interested.”
This stance marks a notable shift for Apple, which has historically avoided large-scale purchases. Its biggest acquisition to date remains the $3 billion Beats deal in 2014. However, it was also recently reported that Apple held internal discussions about potentially acquiring Perplexity, an AI search startup that recently closed a $1 billion funding round and is now valued at over $18 billion. Such a move would far exceed any previous Apple acquisition.
Cook revealed that Apple has already acquired seven companies in 2025, though not all are AI-focused. He stopped short of confirming any specific future deals.
Meanwhile, Apple CFO Kevan Parekh acknowledged that the company’s spending will increase, largely due to AI investments. “It's not going to be exponential growth, but it is going to grow substantially,” Parekh said on the earnings call.
Apple’s renewed focus on AI comes amid pressure to keep pace with industry leaders like Microsoft and Google, both of which have made significant headway in AI through tools such as Copilot and Gemini. Microsoft is expected to spend over $100 billion, while Google plans to spend around $85 billion over the next year. By comparison, Apple has largely relied on third-party data centre providers and has been building its AI technology in-house, including upgrades to its Siri assistant, which are now delayed until 2026.
A recent Morgan Stanley report called the idea that Apple must acquire an AI search startup “misguided.” Still, Cook’s remarks may suggest a more pragmatic approach: if a company can meaningfully enhance Apple’s capabilities, the iPhone maker is willing to pay the price.
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Apple may be ready to break from its long-standing frugal tradition as it races to catch up with rivals in the artificial intelligence space. During the company’s Q3 2025 earnings call, CEO Tim Cook suggested that Apple is open to larger mergers and acquisitions (M&A) if the right opportunity arises, particularly in AI.
Responding to a question from Citi analyst Atif Malik on whether Apple needed to fast-track its AI roadmap despite not traditionally making large acquisitions, Cook clarified that company size is not a constraint. “We’re very open to M&A that accelerates our roadmap,” Cook said. “We’re not stuck on a certain size company. We basically ask ourselves whether a company can help us accelerate a roadmap. If they do, then we are interested.”
This stance marks a notable shift for Apple, which has historically avoided large-scale purchases. Its biggest acquisition to date remains the $3 billion Beats deal in 2014. However, it was also recently reported that Apple held internal discussions about potentially acquiring Perplexity, an AI search startup that recently closed a $1 billion funding round and is now valued at over $18 billion. Such a move would far exceed any previous Apple acquisition.
Cook revealed that Apple has already acquired seven companies in 2025, though not all are AI-focused. He stopped short of confirming any specific future deals.
Meanwhile, Apple CFO Kevan Parekh acknowledged that the company’s spending will increase, largely due to AI investments. “It's not going to be exponential growth, but it is going to grow substantially,” Parekh said on the earnings call.
Apple’s renewed focus on AI comes amid pressure to keep pace with industry leaders like Microsoft and Google, both of which have made significant headway in AI through tools such as Copilot and Gemini. Microsoft is expected to spend over $100 billion, while Google plans to spend around $85 billion over the next year. By comparison, Apple has largely relied on third-party data centre providers and has been building its AI technology in-house, including upgrades to its Siri assistant, which are now delayed until 2026.
A recent Morgan Stanley report called the idea that Apple must acquire an AI search startup “misguided.” Still, Cook’s remarks may suggest a more pragmatic approach: if a company can meaningfully enhance Apple’s capabilities, the iPhone maker is willing to pay the price.
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