Apple Loses Ground as AI Boom Favors Rivals

Apple's stock has taken a hit in recent weeks, falling 10% since its record high on July 28. This downturn comes as investors become more bullish about AI spending, causing Microsoft, Google, and Amazon stocks to rise instead.

The Cupertino company's strategy of not investing heavily in data centers was seen as a positive factor earlier this summer when its shares rallied $600 billion due to 'rising unease about the prospects for heavy spending on AI paying off.'

However, with the market now favoring companies that are aggressively pursuing AI, Apple's lack of correlation to semiconductor stocks is now working against it. The company's Q3 earnings results were the highest ever for a June quarter, but Wall Street is focused on what's happening tomorrow, not yesterday.

The expected launch of new Apple products in September could be another complication for the company, as the AI boom may lead to higher memory prices and subsequently higher-than-expected iPhone 18 Pro and iPhone Ultra prices.