Apple Was Always 1 Step Behind in AI. In Chipmaking, It’s Now 1 Step Ahead.

Apple's recent chipmaking advances have put the company ahead in artificial intelligence (AI), despite being seen as lagging in the field. The company unveiled the M6 chip, built on TSMC's most advanced 2nm process, which is now the first of its kind in consumer computers. This chip, introduced in a new Mac mini and a more powerful M5 Ultra in the refreshed Mac Studio, delivers nearly 30% more peak GPU compute for AI than the previous M5 and over eight times that of the M1.

The M6 can run large language models (LLMs) locally without sending data to the cloud, thanks to up to 32GB of memory. Apple's AI budget is a small fraction of the combined $650 billion spent by Amazon, Microsoft, Meta, and Google on AI data centers this year. Apple believes the future of AI lies in the device in your hand rather than remote data centers, as it expects the heaviest AI to run locally on computers.

The company has around 2.5 billion devices in use, and each M6 chip shipped turns another Mac into an AI-capable machine. While Apple's chip is ready, the software to fully leverage it remains a challenge. Despite strong stock performance, concerns over supply chain constraints and weaker-than-expected performance in the Services and China segments have pressured AAPL stock. Analysts project steady but modest growth for the company.