Shares of Chinese tech giants Baidu (BIDU) and Alibaba (BABA) rose after Apple (AAPL) got the green light to launch its new AI services in China. The Cyberspace Administration of China added Apple to its list of approved on-device AI providers on Wednesday. This decision clears a major roadblock for the iPhone maker in its world’s second-largest market.
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At the same time, Apple stock opened 1% higher on Thursday as investors anticipated the company’s Fiscal third-quarter financial results on July 30.
Apple Is Partnering with Local Chinese Firms
Foreign AI models like Google’s (GOOGL) Gemini and OpenAI’s ChatGPT are not allowed in China. This restriction forced Apple to find local tech partners to run its services. The company spent over a year working with local developers to meet the country’s strict rules on data and content. This effort has finally paid off.
Alibaba announced that its own Qwen AI model will run features inside Apple Intelligence across iPhones, iPads, Macs, and the Vision Pro. At the same time, Baidu confirmed it is working with Apple to handle search functions for the AI system inside the country. This local support is essential for Apple to offer advanced features to Chinese consumers.
Chinese Stocks Rise on the Apple News
The news gave a nice lift to both Chinese companies. In U.S. trading, Alibaba shares went up 0.8%, and Baidu rose 2.8%. The stocks did even better in Hong Kong, where both jumped by about 3%. Apple shares also saw a modest 1% gain in early trading on Thursday following the announcement.
This partnership is a big win for Alibaba and Baidu, giving them direct access to millions of premium smartphone users. It also helps Apple close the gap with local phone makers like Huawei and Xiaomi (XIACF). These rivals have already been selling phones with built-in AI features, making the Chinese market highly competitive. This official approval gives Apple a strong tool to win back customers.
What Is the Price Target for AAPL?
Overall, Wall Street has a Moderate Buy consensus rating on Apple stock based on 18 Buys, 10 Holds, and two Sells recommendations. The average AAPL stock price target of $324.23 indicates 0.62% downside risk. (See AAPL stock forecast)
