Tim Cook warns of slow Siri AI roll-out in China, worsening memory crisis

Apple CEO Tim Cook revealed that the company's rollout of AI features in China would be slower than initially expected, leaving the country's memory crisis to worsen. Customers in mainland China would initially access a limited set of Apple Intelligence capabilities, which includes the "Clean Up" photo-editing tool. Cook announced during an earnings call that more work would be needed for Siri AI integration in the future.

The company is collaborating with Chinese firms, including Alibaba Group Holding and Baidu, to power these features on iPhones, marking a two-year delay since Apple Intelligence's launch in other markets. Despite the delayed rollout, Apple Intelligence expansion is vital for Apple, aiming to combat fierce domestic competition in the world's largest smartphone market.

Apple’s total revenue in China rose 22% to $18.8 billion, but fell short of analysts' estimates of $19.6 billion. This performance, combined with supply constraints in semiconductors, led Cook to issue weaker year-on-year sales growth guidance of 9 to 11% for the September quarter. Memory costs are anticipated to be higher, and Apple will attempt to offset the pressure by utilizing inventory.

Tarun Pathak, a research director at Counterpoint Research, believes Apple will outperform the industry in its key hardware categories, driven by the strength of its installed base and the positive reception of Siri AI.