Apple Is Developing Chips for AI Software in Data Centers, According to Reports

According to a report from the Wall Street Journal on Tuesday, Apple has been working on chips designed to power artificial intelligence software within data centers.

Sources familiar with the matter reported that Project ACDC (Apple Chips in Data Center) has been under development for many years without a defined timeline for completion.

The report mentioned that Apple has joined forces with Taiwan Semiconductor Manufacturing Co. (TSMC) on both the design and production of the chip. However, it is unclear whether these efforts have led to successful outcomes.

Industry analysts anticipate that Apple’s server chip will primarily handle AI inference tasks instead of AI model training. They also highlight that Nvidia is expected to maintain its dominance in the AI model training sector.

Within AI, inference is how trained machine learning models make sense of new data. Companies like Google are creating their own AI inference server chips to gain more control over their technology.

Industry experts have highlighted that Apple has fallen behind in the AI race compared to competitors like Microsoft, who have invested billions into AI technology and infrastructure.

Apple CEO Tim Cook announced in February that the company is making substantial investments in AI technology and plans to unveil related developments later this year. Analysts anticipate this announcement to be made during Apple’s Worldwide Developers Conference scheduled for June.

On Thursday, during Apple’s recent quarterly earnings call, Cook informed investors about the company’s ongoing investments in AI. “We continue to feel very bullish about our opportunity in Generative AI. We are making significant investments, and we’re looking forward to sharing some very exciting things with our customers soon,” he said.

“We believe in the transformative power and promise of AI, and we believe we have advantages that will differentiate us in this new era, including Apple’s unique combination of seamless hardware, software and services integration, groundbreaking Apple’s silicon, with our industry-leading neural engines and our unwavering focus on privacy, which underpins everything we create,” Cook added.

Apple exceeded expectations in its fiscal second-quarter earnings, even as overall revenue declined by 4% due to decreased iPhone sales. However, the company’s announcement of a $110 billion share buyback on Thursday, its largest ever, led to a significant increase in share price.