How a Canadian startup fits into Apple’s AI goals

Apple’s latest stealthy acquisition brings a Canadian startup into AI plans that are slowly coming into focus.

What happened: Apple bought Kitchener-Waterloo startup DarwinAI, according to Bloomberg sources. The acquisition apparently happened earlier this year, and dozens of DarwinAI’s staff are already working in Apple’s AI division.

Zoom out: DarwinAI’s tech visually inspects components during manufacturing for quality control, which could be used to improve more general image recognition tools. But as Bloomberg points out, another one of the startup’s services is making AI faster while taking up less space on computer systems.

  • The method helps AI run better on its enterprise clients’ systems, but it could do the same for devices people have in their homes or pockets.

Why it matters: Apple has been pretty quiet in the Big Tech AI race thus far, sometimes to the annoyance of investors. But CEO Tim Cook has promised big things this year, and signs point to a bet on setting itself apart from rivals by running AI directly on phones and laptops, rather than the cloud.

  • Though it has been low key, Apple has actually been more active in AI investments than the competition, quietly buying stakes in 21 companies from 2017 to 2023.
  • The company's latest chips — M3 for laptops, A17 Pro for iPhones — also have “neural processing units,” Apple’s answer to GPUs in AI chips. The beefed-up M3 Max was also developed with AI work in mind.
  • Staying off the cloud means AI tasks could run while offline or on slower internet connections. Not sending data to be stored in remote servers is also more secure, which fits with Apple’s privacy-focused branding.

What’s next: Apple is expected to have generative AI announcements at its developers conference in June, including new features in iOS 18. There’s no iOS 18 release date yet, but a new version has come out every September since 2012, so that’s a safe bet.