The Fruity Cargo Cult Apple has turned years of AI lag and missed opportunities into a feature.
According to the Financial Times, Job’s Mob trades at 36 times expected earnings for the coming year, despite growing more slowly than most of its big technology rivals. That multiple puts it ahead of Microsoft at 25, Alphabet at 26, Amazon at 27, Nvidia at 18 and Meta at 21.
The Tame Apple press is spinning that as an “extraordinary turnaround” for Job’s Mob. Until late 2025, the company had never seriously challenged for the highest valuation multiple among the group. For years investors marked the shares down because they feared the iPhone might eventually follow Nokia and BlackBerry into the mobile industry’s museum cabinet.
More recently, the problem was simpler. Job’s Mob grew more slowly than the rest of big tech while Microsoft, Google and others piled into generative AI. That remains the case. The market expects Job’s Mob’s earnings to grow at a high single-digit rate during the next few years, slower than its large technology peers.
Services growth is slowing, and the company faces rising input costs. Its new folding iPhone starts at $1,999, pushing handset prices into previously unexplored territory. Yet investors have decided the company’s failure to spend hundreds of billions fighting the AI infrastructure war might be exactly what they fancy.
The Financial Times reckons the premium reflects investors seeking technology shares less exposed to increasingly eye-watering AI spending. UBS analyst David Vogt said: “Apple tends to be countercyclical from a risk appetite perspective.”
A year or two ago, when investors were treating anything containing the letters AI as if it had discovered cold fusion, Job’s Mob enjoyed no comparable valuation premium.
“What has changed is the view that doing billions in capex to support the AI model makers might not be the best investment,” Vogt said.
Job’s Mob spent years trailing Microsoft, Google, OpenAI and others in generative AI. Its much-hyped Siri overhaul slipped while rivals shipped increasingly capable models and assistants. The Tame Apple Press routinely found kinder descriptions for this state of affairs, with lateness becoming caution and missing technology becoming Apple’s legendary determination to get things right.
Now the same weakness is being sold to investors as insulation from the AI spending frenzy. There is one small wrinkle. Job’s Mob has hardly escaped AI spending because it suddenly cracked the technology without needing anyone else. Its current Apple Intelligence generation relies substantially on technology developed with Google. Job’s Mob has said its latest foundation models were custom-built in collaboration with Google using technology behind the Gemini family.
More demanding cloud workloads can run through Private Cloud Compute, including infrastructure hosted on Google Cloud. In other words, Job’s Mob arrived late to the AI party and then hired one of the companies already paying for the booze.
This leaves the cocaine nose jobs of Wall Street in the curious position of rewarding Job’s Mob for avoiding the vast AI capital bills being swallowed by companies supplying its AI.
The FT thinks that privacy is how Apple has managed to stay ahead. Privacy has been central to Job’s Mob’s sales pitch for years. Former Apple chief executive Tim Cook rarely missed an opportunity to remind customers that their personal information was supposedly safer inside Cupertino’s walls.
New Apple chief executive John Ternus followed the script during the company’s latest phone launch. Apple Intelligence processes requests locally when possible and uses its encrypted Private Cloud Compute system when it needs more processing muscle.
Ternus contrasted that approach with rivals that “see your data as something to collect”.
The argument has some weight because iPhone customers are unusually sticky. Once captured inside Jobs’ cult of software and services, relatively few wander off because it feels like too much hard work.
The FT reckons that reputation has become increasingly valuable while the AI industry’s largest players struggle with questions about control, accountability and safety.
The FT argues that this makes Job’s Mob’s old privacy promise look reassuring by comparison. That interpretation conveniently ignores why Job’s Mob has less direct exposure to the AI arms race. It spent much of the race behind everyone else. Rather than building a competitive frontier AI operation on its own, it eventually turned to Google.
The Tame Apple Press can paint that as capital discipline if it likes. Investors appear happy enough with the arrangement for now. An awkward collision remains between Jobs’ Mob’s privacy mythology and its growing dependence on external AI technology.
The company wants its devices to become premium hosts for AI services without spending the hundreds of billions hyperscalers commit. That means allowing more of the machinery behind Apple Intelligence to sit outside its traditional walled garden.
Job’s Mob says its privacy protections survive the move because Private Cloud Compute limits access to personal data and allows independent verification of its security promises. Google nevertheless helped build the current foundation models, while some Private Cloud Compute workloads can now run on Google Cloud infrastructure.
