<div id="readability-page-1">There's no denying it. Generative artificial intelligence is a game-changer. Even without knowing exactly how it will revolutionize the world when all is said and done, it seems this technology delivers the sort of solutions envisioned when computers first started becoming relatively common three decades ago. There's a good reason so many tech companies are getting into the business. Apple (AAPL 0.32%) is, of course, one of those companies. However, like every other name in this budding industry, Apple's entry into the race is different than any other player's. It's also arguably better. Here's how, and why it matters to investors. <h2>What's generative AI?</h2> First things first -- what exactly is generative AI? To best understand what generative artificial intelligence is, it may be best to compare it to what it isn't. To date, computers have only done what software instructed them to do -- no more and no less. And, of course, this software is just a compilation of thousands of coded instructions. With the advent of generative artificial intelligence, though, computers can effectively make judgment calls in response to the often-arbitrary requests you make of platforms like ChatGPT or Microsoft's Copilot. This can be anything from creating an image to writing a simple synopsis of a complex idea to analyzing data or even the creation of computer code that might otherwise be too time-consuming to piece together from scratch. Generative AI has even been used to create writing prompts or plot outlines for fiction stories. There's nothing much that's actually artificial about what the world is calling artificial intelligence. Almost all AI platforms are just powered by a deep analysis of a massive amount of underlying data. However, it looks, feels, and acts like the artificial intelligence often portrayed in science fiction films. Generative AI can make intuitive decisions meant to meet your specific needs or create something from nothing. That's why Precedence Research believes the global generative artificial intelligence market is set to grow at an annualized pace of 44% through 2034, when it will be worth $1 trillion. The question remains, though -- what's Apple doing on this front? <h2>Apple's generative AI entry</h2> It's called Apple Intelligence. First announced in June and launched in October, Apple intends for its latest and future versions of its iPhones, iPads, and Mac computers to be true handheld generative AI devices capable of everything from creating custom images to summarizing emails to helping manage device owners' schedules. More than an app, Apple Intelligence turns Apple's hardware into true personal assistants by making owners more efficient and by doing so fluidly and intuitively. As CEO Tim Cook explained during last month's quarterly earnings call, &#34;Apple Intelligence opens up an exciting new frontier and is already elevating experiences across iPhone, iPad, and Mac. We're going to keep investing in innovation and in transformative tools that help users in their everyday lives.&#34; To this end, Apple's ultimate goal is to sell more iPhones by making them an indispensable tool to consumers. It's not a stretch to suggest Apple is doing more on the consumer-facing generative AI front than any other name is, either. As The Motley Fool's in-house research arm points out, Apple's management has been tossing around the term &#34;AI&#34; during its recent earnings calls more than any other company in the business has since early last year. These other companies include Nvidia and Microsoft, which are certainly no slouches Apple isn't limiting the development of its artificial intelligence to tasks that can be handled directly from its devices, however. Although not just capable of supporting generative AI tasks, the company has been working on its own data center processor chips that appear to be intended to serve owners of Apple devices when they require more computing power and more data to analyze than their hardware is able to supply. With this complementary approach, the company can offer its customers a complete, soup-to-nuts generative AI solution rather than relying on a bunch of third-party service providers with their own goals. <h2>It's coming, sooner or later</h2> That's the plan, anyway. Just for the record, however, the company isn't exactly knocking it out of the park yet. IPhone revenue for the quarter ended in December was essentially flat year over year, even though the iPhone 16 introduced in September is fully capable of supporting the processing-intensive Apple Intelligence platform. This tepidness extends to the long-standing stagnation of the popular smartphone's revenue. Apple no longer discloses iPhone unit sales, but industry research outfit IDC also reports that the total number of iPhones shipping during the final quarter of last year actually fell 4.1% year over year while overall smartphone shipments grew by 2.4%. <div><img src="https://imageproxy.pbkrs.com/https://g.foolcdn.com/image//query-b3A9cmVzaXplJnVybD1odHRwczovL2cuZm9vbGNkbi5jb20vZWRpdG9yaWFsL2ltYWdlcy84MDYzMjYvMDIwNDI1LWlwaG9uZS1zYWxlcy5wbmcmdz03MDA?x-oss-process=image/auto-orient,1/interlace,1/resize,w_1440,h_1440/quality,q_95/format,jpg" width="700" height="503" original-src="https://imageproxy.pbkrs.com/https://g.foolcdn.com/image//query-b3A9cmVzaXplJnVybD1odHRwczovL2cuZm9vbGNkbi5jb20vZWRpdG9yaWFsL2ltYWdlcy84MDYzMjYvMDIwNDI1LWlwaG9uZS1zYWxlcy5wbmcmdz03MDA"/>Data sources: Apple Inc. and IDC. Revenue and unit data are both in millions. </div> Consumers clearly aren't piling into new iPhones to plug into their artificial intelligence capabilities -- at least not yet. It's too soon to throw in the towel here, however. There's still a great deal of consumer education that needs to be done just to make the world aware of all the generative AI can do for them. As this work moves forward, don't be surprised to eventually see Apple's iPhone business perk up. This, of course, will bolster the already bullish case for owning Apple stock. </div>

AAPL

Apple is entering the generative AI market with its new initiative, Apple Intelligence, aimed at enhancing user experience across its devices. This technology allows for intuitive decision-making and personalized assistance, positioning Apple to potentially lead in consumer-facing generative AI. Despite ambitious plans, iPhone revenue growth has stagnated, with a 4.1% decline in shipments last quarter. CEO Tim Cook emphasizes ongoing investment in innovation to make Apple devices indispensable for consumers.

- Generative artificial intelligence is transforming technology, enabling computers to make intuitive decisions and perform complex tasks.  
- Apple has launched Apple Intelligence, aiming to integrate generative AI into its devices, enhancing user efficiency and experience.  
- Despite current stagnation in iPhone sales, the potential for growth in the generative AI market could positively impact Apple's business and stock value in the future.

Here's How Generative AI Factors Into Apple's Plan for Growth