Apple's latest AI struggle; Check out the new book on Apple in China; Two ominous articles on AI that caught my attention

1) You might have seen by now that Apple (AAPL) kicked off its much-anticipated Worldwide Developers Conference earlier this week...

The tech giant holds this event every year. During it, the company showcases its latest software, devices, and technologies. And the event allows Apple engineers to connect with the many external developers who are a critical part of the Apple ecosystem.

The conference gets a lot of hype. But with artificial intelligence ("AI") being the hot tech topic, Apple failed to impress in this area.

This Heard on the Street column in the Wall Street Journal on Tuesday has more details on Apple failing to meet its AI expectations: Apple Fails to Clear a Low Bar on AI . Excerpt:

The company wrapped the opening keynote of its annual developers' conference on Monday with no major surprises about its AI efforts. A program to allow developers to access its "foundation models" was widely expected and could – over time – result in AI apps that work more easily on Apple's devices.

But the bulk of the event was focused on updates to Apple's existing operating systems for its devices. This includes a design enhancement for the look of its software called "liquid glass." Apple's share price, down 19% already this year, slipped further on Monday following the keynote. "Many of the AI features announced were more incremental in our view, and already available through competitor applications," UBS analyst David Vogt wrote in a report following the event.

Amid an AI arms race among the tech giants, it's a bad sign that Apple is still whiffing on the technology.

2) I also worry that Apple is extremely vulnerable to the unfolding, ever-changing trade situation with China...

That's after reading an insightful new book titled Apple in China: The Capture of the World's Greatest Company. Here's a New York Times review that summarizes it well: Apple Used China to Make a Profit. What China Got in Return Is Scarier . Excerpt:

[As author] Patrick McGee makes devastatingly clear in his smart and comprehensive "Apple in China," the American company's decision under Tim Cook, the current C.E.O., to manufacture about 90 percent of its products in China has created an existential vulnerability not just for Apple, but for the United States – nurturing the conditions for Chinese technology to outpace American innovation.

McGee, who was the lead Apple reporter for The Financial Times and previously covered Asian markets from Hong Kong, takes what we instinctively know – "how Apple used China as a base from which to become the world's most valuable company, and in doing so, bound its future inextricably to a ruthless authoritarian state" – and comes up with a startling conclusion, backed by meticulous reporting: "that China wouldn't be China today without Apple."

Apple says that it has trained more than 28 million workers in China since 2008, which McGee notes is larger than the entire labor force of California. The company's annual investment in China — not even counting the value of hardware, "which would more than double the figure," McGee writes — exceeds the total amount the Biden administration dedicated for a "once-in-a-generation" initiative to boost American computer chip production.

I recommend adding the book to your reading list. You can find it here on Amazon.

And looking ahead, I'll discuss Apple's stock in greater depth next week – so stay tuned!

3) Speaking of AI, this NYT article from earlier this week highlights the job losses that could result from it: This A.I. Company Wants to Take Your Job. Excerpt:

Some of today's A.I. systems can write software, produce detailed research reports and solve complex math and science problems. Newer A.I. "agents" are capable of carrying out long sequences of tasks and checking their own work, the way a human would. And while these systems still fall short of humans in many areas, some experts are worried that a recent uptick in unemployment for college graduates is a sign that companies are already using A.I. as a substitute for some entry-level workers.

[Last Thursday], I got a glimpse of a post-labor future at an event held in San Francisco by Mechanize, a new A.I. start-up that has an audacious goal of automating all jobs – yours, mine, those of our doctors and lawyers, the people who write our software and design our buildings and care for our children.

"Our goal is to fully automate work," said Tamay Besiroglu, 29, one of Mechanize's founders. "We want to get to a fully automated economy, and make that happen as fast as possible."

4) And here's a WSJ article from earlier this week that has some ominous details about news websites when it comes to AI: News Sites Are Getting Crushed by Google's New AI Tools. Excerpt:

Chatbots are replacing Google searches, eliminating the need to click on blue links and tanking referrals to news sites. As a result, traffic that publishers relied on for years is plummeting.

Traffic from organic search to HuffPost's desktop and mobile websites fell by just over half in the past three years, and by nearly that much at the Washington Post, according to digital market data firm Similarweb.

As the article continues, that has led to layoffs at Business Insider. Here's more:

Business Insider cut about 21% of its staff last month, a move CEO Barbara Peng said was aimed at helping the publication "endure extreme traffic drops outside of our control." Organic search traffic to its websites declined by 55% between April 2022 and April 2025, according to data from Similarweb.

At a companywide meeting earlier this year, Nicholas Thompson, chief executive of the Atlantic, said the publication should assume traffic from Google would drop toward zero and the company needed to evolve its business model.

This chart from the WSJ article no doubt scares the pants off news publishers:

I continue to closely follow developments in AI and will keep sharing my thoughts on the winners and losers with my readers as the environment evolves.

Best regards,

Whitney

P.S. I welcome your feedback – send me an e-mail by clicking here.