Apple's Upcoming AI Features

Investing.com — Apple (NASDAQ:AAPL) is set to launch initial AI features in April, which Bernstein analysts describe as potentially modest compared to bullish expectations.

Expected Features in iOS 18.4

The upcoming iOS 18.4 is expected to introduce "intelligent agents" designed to enhance AI utility by blending personal information with agentic capabilities. The features will include:

• On-screen integration
• App connectivity
• Personal context

This represents a notable advancement over the basic updates introduced in iOS 18.2.

Industry Challenges

Bernstein analysts caution that agentic AI presents challenges, with state-of-the-art model success rates at only 22-25% on benchmarks. Hardware limitations, particularly the iPhone 16’s 8GB of RAM, further hinder Apple's ability to implement robust multi-step functions.

Analysts, led by Toni Sacconaghi, noted, "The industry and Apple are working on improving agency, and Apple’s App Intents framework is partly designed to simplify complex features, reducing the risk of hallucinations."

However, this approach may also lead to underwhelming AI functionalities at launch, especially for those with higher expectations.

Competitive Advantages

Despite these challenges, Apple has stronger access to user data than Android competitors, allowing for potentially more personalized AI experiences. The company's level playing field with third-party developers regarding data-sharing negotiations supports this advantage.

Nonetheless, applying personal context effectively remains a challenge, as inaccuracies and hallucinations persist.

Analysts' Outlook

Overall, analysts predict that Apple’s initial agentic features may not meet the high hopes of investors and users. The investment firm does not foresee a significant impact from iPhone 16 later this year but believes that iPhone 17 could launch a strong cycle due to improved AI capabilities and design changes.