On the technical front, many of the eagerly anticipated artificial intelligence features that Apple promised at last year’s conference have been postponed until next year. Meanwhile, competitors like Alphabet’s Google and Microsoft are attracting developers with a plethora of new AI capabilities. Among the unmet expectations are significant enhancements to Siri, Apple’s digital assistant.
Regulatory challenges are also intensifying, with courts in the US and Europe ready to dismantle the lucrative protections surrounding Apple’s App Store, leading even former supporters to question the justification of its fees.
These issues are compounding as US President Donald Trump has threatened to impose 25% tariffs on Apple’s top-selling iPhone. Since the beginning of the year, Apple’s stock has dropped over 40%, a steeper decline compared to Google, and it continues to lag behind the AI-driven surges in Microsoft shares.
Apple has introduced some of the AI features it pledged last year, such as a range of writing and image-generation tools, but it still depends on partners like OpenAI, the creator of ChatGPT, for certain functionalities. Bloomberg reports that Apple may release its in-house AI models to developers later this year.
However, analysts suggest that Apple does not yet possess what technologists refer to as a “multi-modal” model—capable of processing imagery, audio, and language simultaneously—which could enable the creation of smart glasses, a category that has gained immense popularity for Meta Platforms. Google announced last month its intent to re-enter this market alongside partners.
These glasses, significantly lighter and more affordable than Apple’s Vision Pro headset, could be useful by comprehending what users are viewing and assisting in answering related questions.
While Apple has concentrated on its $3,500 Vision Pro headset, Google and Meta are leveraging the smart glasses as a cost-effective avenue to deploy their AI technologies against Apple in its hardware stronghold. Meta’s Ray-Bans are all priced under $400.
Analysts believe Apple must address this challenge, but it is unlikely that the company will make significant announcements this week.
“I’m not looking to replace my phone — this is a complementary device that offers a broader understanding of the world, thanks to its camera and ability to perceive what I see and interact with me in natural language,” remarked Ben Bajarin, CEO of the technology consultancy Creative Strategies. “Apple isn’t positioned to achieve that.”
It’s worth noting that Apple’s competitors are not definitively ahead in the smart glasses market. Anshel Sag, principal analyst at Moor Insights & Strategy, noted that while Meta’s Ray-Bans still lack some features, Google has yet to release its “Gemini” model as a mainstream product.
“Meta holds the clear lead, but Google is rapidly catching up and likely has the most suitable AI for the task,” Sag commented. “Vision Pro is impressive but essentially a showcase product for developers.”
Bob O’Donnell, CEO of TECHnalysis Research, stated that it’s still uncertain whether smart glasses will achieve widespread acceptance. He added that Apple might not be at a significant disadvantage if it collaborates with companies like Google, OpenAI, or even smaller firms like Perplexity for core AI technologies.
So far, O’Donnell indicated that there is insufficient evidence suggesting that consumers are making major hardware purchasing decisions based on AI features.
“There’s a case to be made that Apple being behind might not be an issue, as most consumers, except the early adopters, don’t prioritize it,” O’Donnell concluded.
