Apple’s AI Storytelling Casts a Spell on Investors

What a difference a snazzy presentation makes! Apple regained its status as the most valuable company for a few hours on Wednesday as its stock rallied for the second day in a row following its Monday artificial intelligence revelations. By day’s end, though, investors seemed to realize they’d gone overboard. Apple stock fell back from its highs, while shares of Microsoft—which arguably has a stronger AI story to tell, given its OpenAI partnership—rallied enough to edge above Apple’s. The two companies finished the day just $11 billion apart in market capitalization—Microsoft’s $3.278 trillion to Apple’s $3.267 trillion.

For Apple, whose revenue has fallen slightly over the past 18 months, this week's rally is a reminder of the power of good storytelling in winning over investors. While the AI presentation was very well put together, it’s far from certain the new AI features will work as well as advertised or will persuade many people to buy new iPhones, which is what it’s all about. Most of the new features won’t roll out until well after the next iPhone is released, as Bloomberg’s Mark Gurman pointed out, which means it may not affect sales of the new version expected out this fall.