Among its Big Tech peers, Apple has long been the outlier — the digital behemoth whose primary business is still centered on physical objects you can actually touch, carry, and put in your pocket. While rivals have increasingly leaned into cloud services, advertising empires, and abstract software platforms, Apple has doubled down on designing and selling sleek slabs of glass, aluminum, and silicon. That focus has served the company extraordinarily well. After all, consumers still need tangible gateways into the digital universe, and Apple has obligingly produced billions of those portals, turning iPhones, iPads, Macs, and wearables into one of the most profitable product ecosystems in corporate history.
But according to Bloomberg’s resident Apple whisperer Mark Gurman, some of Apple’s top executives are beginning to see that defining strength as a potential liability. And no, the reason won’t surprise you — it’s artificial intelligence. (Okay, fine, pretend you’re shocked.)
In the latest edition of his Power On newsletter, Gurman mounts a quiet but pointed critique of Apple’s long-standing gadget-first philosophy. He argues that the company’s leadership increasingly recognizes that the age of hardware primacy may be waning, particularly as the tech industry pivots toward an AI-dominated future. As Gurman puts it, “The company’s own senior executives understand this and privately question whether Apple has the right ingredients to win in the AI-first landscape.”
Stripped to its essentials, Gurman’s case is that hardware is no longer the star of the show — it’s merely the wrapper. What truly matters now, he suggests, is the software experience embedded inside the device: the intelligence, adaptability, and personalization that AI systems promise to deliver. Apple may preside over a wildly lucrative App Store and an unmatched device ecosystem, but it lacks something its competitors are beginning to experiment with more aggressively: hardware that feels purpose-built for an AI-native world.
Meta, for instance, has staked an early claim with its line of AI-infused smart glasses. Those devices may not be runaway commercial hits — at least not yet — but they signal a willingness to rethink form factors altogether. Against that backdrop, Apple’s position appears increasingly awkward, especially when combined with a series of recent developments: the departure of longtime AI chief John Giannandrea, the company’s highly publicized decision to lean on Google’s AI models to plug gaps in its own capabilities, and the growing perception that Apple is reacting to the AI boom rather than driving it.
Taken together, these signals paint Apple as uncharacteristically stiff and slow-moving — a company that, for all its resources, risks looking dated in an industry obsessed with reinvention. The contrast becomes even starker when considering that OpenAI is expected to unveil a physical product later this year. While early reports suggest the device may amount to little more than a new take on earbuds, the symbolism matters: an AI-first company experimenting with hardware, while the world’s most famous hardware company hesitates.
When it comes to concrete product direction, however, Gurman’s column is notably thin on specifics and heavy on his own prescriptions. One point he does make — and it’s a reasonable one — is that Apple would be far better positioned than OpenAI to successfully market AI-powered earbuds at scale, given its brand power, retail footprint, and entrenched customer base.
Beyond that, Gurman predicts Apple will pursue what he calls a “patchwork approach” to AI hardware and services. Rather than unveiling a single, bold, AI-defining device, the company is expected to roll out a constellation of offerings: AI-enhanced wearables, smarter home devices, and service-layer features, all loosely unified by a revamped version of Siri, which Apple is expected to showcase later this month.
If that vision proves accurate, it sounds less like Apple is panicking about lacking the “right ingredients” for an AI-first future and more like the company is hedging its bets — cautiously probing the terrain while waiting for clearer signals about what consumers actually want. Silicon Valley hype cycles may be loud and relentless — today it’s AI assistants and speculative tools like Moltbot — but in the real world, people remain deeply invested in traditional hardware-and-software ecosystems. Many of those ecosystems still revolve around Apple’s iOS and macOS platforms.
Recent history offers a warning here. Users have reacted poorly to Microsoft’s heavy-handed attempts to force AI features into Windows, suggesting that consumers value stability and familiarity more than they crave constant AI intervention. In other words, the long-standing relationship between everyday users and their personal devices doesn’t appear to be on the brink of collapse.
For Apple, that reality cuts both ways. It may limit the urgency to radically reinvent itself overnight — but it also raises the question of how long the company can afford to wait before AI stops being an optional enhancement and starts becoming the organizing principle of consumer technology. For now, though, the status quo still looks surprisingly resilient — and that, at least in the short term, continues to work in Apple’s favor.