Apple no longer innovates -- it waits. And with AI, anyone playing it safe will get left behind.

Apple's struggles represent a fundamental misreading of the AI revolution.

Apple sits in an unprecedented position: It's a company worth more than $3 trillion that's somehow missing the most transformative technological shift since the internet.

While rivals race ahead in artificial intelligence (AI), the iPhone maker is stuck in neutral, watching its market leadership erode with each passing quarter.

A solution might be on the way, but don't hold your breath. Apple is reportedly preparing an AI product blitz That would give a new shine to its device lineup — with robots that include a lifelike version of Siri, a smart speaker with a screen, a new operating system and major home security services.

But is Apple too late?

Skepticism runs deep about Apple's AI makeover after previous efforts with Siri, Apple Intelligence, and Apple Vision Pro largely fizzled. But a determined Tim Cook, Apple's chief executive, insists the company "must win in AI" and restore its innovation edge, according to a Bloomberg report. And last week, Bloomberg reported that Apple is considering using Alphabet's Gemini. to create an AI-powered Siri program .

Meanwhile, stock investors are rewarding Apple's rivals — Nvidia Microsoft Alphabet and Meta Platforms — for their aggressive AI investments.

Apple continues to rely on stock buybacks as its primary growth strategy. It's a defensive playbook when the moment demands bold offensive moves.

Apple's struggles represent a fundamental misreading of the AI revolution. While competitors pour resources into large-language models, autonomous systems and AI-powered services, Apple continues to rely on stock buybacks — to the tune of $704 billion over the past decade — as its primary growth strategy. It's a defensive playbook when the moment demands bold offensive moves.

One such move, a pledge by the company to invest $600 billion into U.S. operations over the next four years, promises a boost in manufacturing. But will we ever see it done? Is it a legitimate strategy or one of the empty commitments Apple has been making for some time?

In the meantime, a talent exodus speaks volumes about Apple's internal dysfunction around AI. The company lost its fourth top AI researcher to Meta this year, joining a broader brain drain that should alarm both investors and customers. When your brightest minds are fleeing to competitors, it signals deeper cultural and strategic problems that go beyond any single product cycle.

Every quarter Apple delays meaningful AI investment, the gap widens.

Perhaps most telling is Siri's continued mediocrity. After more than a decade of development, Apple's virtual assistant remains laughably behind OpenAI's ChatGPT, Google Assistant, and other AI alternatives. Getting Siri to "not suck," as one analyst bluntly put it, now seems highly improbable given Apple's track record. This isn't just a product failure, but a symbol of organizational complacency.

Read: Is Apple making the same mistakes BlackBerry did? Here's how it can change course.

The AI revolution differs fundamentally from previous tech cycles. Unlike the mobile transition, where Apple could observe, learn and then leapfrog competitors with superior execution, AI advantages compound rapidly. Companies with early leads in data, talent and infrastructure create moats that become increasingly difficult to bridge. Every quarter Apple delays meaningful AI investment, the gap widens.

Consider the operating leverage dynamics at play. AI is inherently deflationary, benefiting companies that can spread development costs across massive user bases and infrastructure. Nvidia, AMD, Microsoft and Alphabet understand this, which is why they're being rewarded for aggressive capital expenditure. Apple's traditionally conservative approach of waiting to perfect products before launch could prove catastrophic in a field where speed and scale determine winners.

Apple's entire ecosystem assumes the smartphone will remain our primary device, but that assumption is increasingly looking vulnerable.

The smartphone-centric worldview that built Apple's empire may be under threat. Meta's bet on mixed-reality glasses as the next primary computing device isn't far-fetched when viewed through an AI lens. OpenAI is working with iPhone designer Jony Ive on a hardware project of its own.

If ambient intelligence becomes the norm — and users interact with AI through voice, gesture, and environmental sensors — the iPhone's touch screen interface could seem quaint. Apple's entire ecosystem assumes the smartphone will remain our primary device, but that assumption looks increasingly vulnerable.

Some argue that Apple's massive installed base of 2.2 billion users provides enough runway to catch up. This misses the point. Network effects in AI favor platforms that continuously learn from user interactions. Google search processes billions of queries every day, Meta's algorithms analyze social interactions, and Microsoft's Copilot learns from workplace productivity patterns. Apple's devices generate data, but the company lacks the AI infrastructure to derive competitive advantages from it.

The path forward requires dramatic action. Industry observers have called for Apple to acquire Perplexity, the AI search startup A partnership with Google's Gemini makes sense, as does bringing outside AI talent to Apple's management ranks. Any of these moves would be a departure from Apple's traditional playbook — and that's precisely why they're necessary.

Cook's recent acknowledgment that AI is "as big as the internet" ironically highlights the problem. By the time Apple's leadership recognized the internet's importance, competitors had already built dominant positions. The same pattern threatens to repeat with AI.

Apple remains a formidable cash machine with remarkably loyal customers. But loyalty has limits, especially when competitors offer genuinely superior capabilities. The company that revolutionized personal computing, music and mobile phones now risks becoming the next cautionary tale — a once-dominant player that missed the new wave.

The AI transformation is happening faster than previous technological shifts. Apple's tradition of careful observation and delayed but superior execution won't work this time. The question isn't whether Apple will eventually embrace AI. It's whether that embrace will come too late to matter.

Daniel Newman is the CEO of the Futurum Group, which has provided or provided research, analysis, advising and/or consulting to ServiceNow, Intel, Nvidia, Microsoft, Amazon.com, IBM, AMD and other technology companies. Neither he nor the firm has any positions in any of the companies mentioned. Follow him on X @danielnewmanUV .

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Nvidia wins US approval to resume H20 chip sales in China

Nvidia, the leading producer of artificial intelligence (AI) chips, is at the heart of the geopolitical standoff as semiconductors become increasingly central to the U.S.-China rivalry.

The company's reentry into the Chinese market Last week, reportedly with Washington's blessing, has stirred debate about the strategic consequences for both nations.

For the US, Nvidia's continued presence in China may serve as a strategic lever to maintain its dominance in AI. Experts told CNBC that keeping Chinese companies reliant on US-designed chips and software, especially Nvidia's widely used CUDA platform, helps solidify America's global leadership.

"This relationship is symbiotic, but I do believe China needs US technology more at this moment in time," said Daniel Newman, CEO of Futurum Group, in an interview with CNBC's The China Connection.

For China, Nvidia's return provides a crucial window through which to further develop its domestic semiconductor ecosystem while continuing to build AI capabilities.

Nvidia wins US approval to resume H20 chip sales in China

Earlier this year, the US tightened export restrictions on Nvidia's H20 chip—a downgraded version of its flagship hardware designed to meet earlier compliance requirements. Washington cited concerns about these chips potentially advancing China's military or homegrown AI industry.

The move forced Nvidia to take a $4.5 billion writedown on unsold inventory and warn of revenue impacts running into the billions. Nvidia CEO Jensen Huang has openly criticized the export restrictions, arguing they could accelerate the country's chip development and undermine America's tech leadership.

"It would be a tremendous loss for us not to participate in China," Huang said, adding that in Nvidia's absence, domestic players like Huawei would step in to fill the gap.

That message seems to have resonated in Washington. Nvidia confirmed last week that it had received U.S. government approval to resume H20 sales to China.

While Nvidia is poised to benefit financially, US officials say the move also serves national interests.

In an interview with CNBC, Howard Lutnick, US Commerce Secretary, said that they want to continue having the Chinese use the American technology stack because they still rely on it.

Nvidia's influence extends beyond hardware. Its CUDA software platform has become a cornerstone for AI developers, forming a sticky ecosystem that competitors find difficult to displace.

Pranay Kotasthane, deputy director at the Takshashila Institution, noted that reintroducing H20 in China gives US firms some breathing room while slowing China's drive for chip independence.

"China is Nvidia's largest market and is home to 50% of AI developers," according to Jensen Huang. "If that market closes, it becomes harder for Nvidia to reinvest in R&D," Kotasthane said.

Nvidia's China comeback risks derailing local AI chip ambitions

Huawei remains China's frontrunner In AI chip development, but its hardware still lags behind Nvidia's top-tier products. Meanwhile, a growing field of Chinese startups is racing to produce viable alternatives.

Nvidia's renewed market access could potentially weaken that momentum. Tejas Dessai, director of research at Global X ETFs, warned that easier access to Nvidia chips could divert capital away from domestic projects and delay the development of Chinese alternatives.

Dessai told CNBC that if Nvidia's chips are made available to Chinese companies, it could weaken the momentum behind domestic chip projects, cut off funding, and delay progress in domestic Chinese hardware.

Experts say Nvidia's lead is not just about performance but usability. Chinese developers continue to prefer Nvidia's ecosystem due to its flexibility and depth.

Paul Triolo, a partner at DGA-Albright Stonebridge Group, noted that Chinese model developers still prefer Nvidia hardware because Huawei's software environment remains difficult to use.

Still, China's ambition to reduce reliance on foreign technology remains unchanged. While Nvidia dominates the chips used to train large AI models, Chinese companies may find opportunities in inferencing—the process of running trained AI models, such as chatbots and virtual assistants.

In chips, China's opportunity could come when the focus shifts to inference," said Dessai. "That's when demand for lower-cost, efficient processors could scale, and custom chips from Chinese tech companies could step in.

Nvidia's return to China is more than a business decision—it's a geopolitical calculation. As the AI arms race intensifies, both Washington and Beijing are trying to manage a delicate balance between competition and dependence. Whether this détente holds will depend on how fast China can build a viable Nvidia rival—and how long the US is willing to keep the door open.

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Trump unveils $90 billion in energy and AI investments for Pennsylvania at summit

President Trump and many leaders of the country's largest technology and energy companies announced more than $90 billion in new investments from private companies for Pennsylvania on Tuesday.

Mr. Trump, who spoke for about 30 minutes during a roundtable discussion at the Inaugural Pennsylvania Energy and Innovation Summit at Carnegie Mellon University "Leading technology and energy companies" will invest in Pennsylvania to develop a new artificial intelligence economy, capitalizing on Pennsylvania's technology and energy assets, said 20.

"We're back in Pittsburgh to announce the largest package of investments in the history of the Commonwealth of Pennsylvania," Mr. Trump said on Tuesday.

Among the projects will be the construction of data centers to help provide the enormous amounts of energy needed to power AI, and an energy innovation center to train workers in the Pittsburgh region in energy and AI jobs.

The event was hosted by Republican U.S. Sen. Dave McCormick, who said the Pittsburgh region is uniquely positioned to marry its technological expertise with its vast energy resources in natural gas and nuclear to create a new AI economy. He said the investments will bring "tens of thousands of jobs" to Pennsylvania.

"Our vision for this event came from the realization about the crucial link between artificial intelligence and energy, but never before have the leaders of all those companies, as well as major investors, come together," McCormick said on Tuesday.

Mr. Trump highlighted Westinghouse, saying the Pennsylvania-based company is set to build 10 nuclear reactors across the country. He also praised his involvement in finalizing a $14 billion partnership between Nippon Steel and U.S. Steel , which he said will revitalize the Mon Valley.

Mr. Trump said the investments announced on Tuesday will spawn the development of AI in the region.

"We're building a future where American workers will forge the steel, produce the energy, build the factories and really run a country like, I believe, this country has never been run before. I think we have a true golden age for America," Mr. Trump said. "We've been showing it, and it truly is the hottest country anywhere in the world. I'm honored to be in Pennsylvania, and I'm honored to be in Pittsburgh, and you're going to see some real action here."

The organizers hope the investments mark only the beginning, hopeful of leveraging the summit to ramp up energy production, build more data centers, and spawn new AI companies in the Pittsburgh area — making the region the center of AI in the country.

We have phenomenal technology resources inside of our universities systems," said Bill Demchak, CEO of PNC Financial Services Group, on Tuesday. "We have an abundance of energy, we have Westinghouse in the area. We have labor availability, and we have a huge need as we see the transformation that AI is causing.

The event came after Amazon's announcement in June of a $20 billion investment in data centers across Pennsylvania , the largest economic development project in the state's history.

Major political and industry leaders in Pittsburgh

Several of the president's Cabinet members joined him at the summit.

Commerce Secretary Howard Lutnick, Interior Secretary Doug Burgum, Energy Secretary Chris Wright, EPA Administrator Lee Zeldin, and White House AI and Crypto Czar David Sacks were among the Trump administration officials listed as summit participants.

Gov. Josh Shapiro, a Democrat, was also present. He is participating in a panel about major investments in Pennsylvania, moderated by Penn State University President Dr. Neeli Bendapudi.

Industry leaders such as Alphabet President and CEO Ruth Porat, Anthropic CEO Dario Amodei, Blackstone President and CEO Jon Gray, Gecko Robotics founder and CEO Jake Loosararian, EQT President and CEO Toby Rice, and Amazon Web Services CEO Matt Garman were also listed as panel participants.

Police use pepper spray during Trump protest in Pittsburgh

Mr. Trump's visit was not without pushback , as evidenced on CMU's campus, where signs painted with the words "protest the summit" were seen on The Fence .

That sentiment on the CMU Fence was also posted on social media, in the words of activists, "call on students and the Pittsburgh community to stand against fossil fuels, AI for surveillance, and authoritarianism."

The advocates, who lined the streets across parts of the city , said the summit prioritizes corporate interests over sustainability and ethics.

I do believe we should be focusing more on renewable energy, green energy. Just kowtowing to oil and gas is not the way to the future," said Zach Zourelias of Plum. "I'm not saying get rid of it entirely. It is important for Pennsylvania, it is important for the country. But we need to be looking to the future, not the past.

Pittsburgh Public Safety said officers used pepper spray on demonstrators outside the event on Tuesday evening.

A spokesperson said police issued dispersal orders to demonstrators blocking the street and confronting attendees leaving the event. The spokesperson said a "number of demonstrators were actively resisting" and pushing and shoving officers. That's when two officers deployed pepper spray, officials said.

The spokesperson told KDKA, 'At no time was there an order or authorization for large scale crowd or riot control agents to be used.'

No arrests are expected.

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