TODAY. THEY ARE UP 6% TO A NEW ALL-TIME HIGH ON ALL OF THIS OPTIMISM NOW AFTER THE AI ANNOUNCEMENTS YESTERDAY. SEEMED SLEEPY AT THE TIME, BUT NOT TODAY. SITTING AT $3.1 TRILLION AT THE MARKET CAP. STEVE KOVACH IS JOINING US NOW. STEVE, WHY THE DELAYED REACTION? >> Reporter: YEAH, KELLY. WELL, WHAT A DIFFERENCE A DAY MAKES. APPLE SHARES UP, LIKE YOU SAID, ABOUT 6% TODAY AFTER FALLING 2% YESTERDAY IMMEDIATELY AFTER THAT LONG-ANTICIPATED AI REVEAL. SO THE QUESTION IS, LIKE YOU SAID WHAT CHANGED OVERNIGHT? WELL, A SLEW OF BULLISH WALL STREET COMMENTARY THIS MORNING ABOUT HOW ALL THOSE APPLE AI FEATURES WILL DRIVE HARDWARE SALES LATER THIS YEAR BECAUSE IF FOLKS WANT TO USE THE NEW AI FEATURES THEY NEED LAST YEAR'S APPLE iPHONE 15 PRO OR THE NEXT COMING IN A FEW MONTHS. THE AI iPHONE FOMO EFFECT. HERE IS A TASTE OF SOME OF THE STREET'S MORE BULLISH COMMENTARY OF WHAT WE HEARD AT WWDC. GOLDMAN ANALYSTS SAID THE AI FEATURES, QUOTE, SHOULD HELP TO DRIVE DEMAND FOR PRODUCTS. ALSO RAISE THEIR PRICE TARGET, IMPLYING A 23% UPSIDE OVER THE NEXT 12 MONTHS. MORGAN STANLEY ECHOED THAT IN THEIR NOTE THIS MORNING, SAYING THE HARDWARE REQUIREMENTS WILL SPEED UP iPHONE UPGRADES. AND THAT'S REALLY JUST THE THESIS FOR NOW, THOUGH. BUT THIS IS NOT GOING TO BE PUT TO A TEST FOR A FEW MORE MONTHS WHEN WE'RE EXPECTING THE NEXT iPHONE MODEL. MOST iPHONE OWNERS IN THE INSTALL BASE RIGHT NOW OF MORE THAN 1 MILLION DEVICES WILL NOT HAVE ACCESS TO APPLE'S AI, SO WE'LL HAVE TO WAIT TO SEE IF THEY SPRING FOR AN UPGRADE EARLIER THAN PLANNED JUST FOR THE AI, GUYS. >> AND NOW WE HAVE ELON MUSK KIND OF REACTING QUITE STRONGLY TO SUGGEST MAYBE HE'S NOT GOING TO LET THE NEW iPHONE COME INTO HIS OFFICES IF HE THINKS IT MIGHT LET OUT TRADE SECRETS TO OPEN AI. >> HERE IS THE SHOCKER, KELLY. ELON MUSK PROBABLY DOESN'T KNOW WHAT HE'S TALKING ABOUT HERE AND JUST TWEETING THROUGH IT. I DON'T KNOW WHAT HE WAS WATCHING YESTERDAY BUT IT WAS NOT THE SAME PRESENTATION I WAS AT IN PERSON AND IT'S NOT -- DOESN'T JIVE WITH WHAT APPLE EXECUTIVES TOLD ME YESTERDAY FOLLOWING THE EVENTS. THE CHATGPT SLICE OF THIS IS AN OPTIONAL FEATURE. IT'S SOMETIMES IF YOU HAVE APPLE INTELLIGENCE ON YOUR DEVICE AND YOU ASKED SIRI A QUESTION, IT MAY PROMPT YOU AND SAY, HEY, DO YOU WANT TO TRY AND USE CHATGPT FOR THIS QUERY. YOU DON'T HAVE TO DO THAT. MOST OF WHAT WAS ANNOUNCED YESTERDAY, THE VAST, VAST, VAST MAJORITY OF WHAT WE SAW IS RUNNING ON APPLE'S PROPRIETARY AI TECHNOLOGY. NOW, YOU CAN BE SKEPTICAL AND SAY YOU DON'T BELIEVE APPLE'S PRIVACY THINGS -- >> HERE IS THE THING. JUST TO JUMP IN FOR A MOMENT. WE SPOKE TO DAVID KENNEDY LAST HOUR ABOUT THIS. HE THOUGHT IT WAS LEGITIMATE CONCERN AND POINTED SPECIFICALLY TO WHEN YOU ASK SIRI A QUESTION AND SHE ASKS DO YOU WANT A ANSWER ON CHATGPT, TAKEN THE SPOKEN OR WRITTEN COMMAND FEEDING BACK TO OPENAI AND GET IT OUTSIDE OF -- >> IT DOESN'T DO THAT UNLESS YOU TELL IT YOU WANT IT TO DO THAT. THAT'S THE -- IT'S NOT JUST SENDING IT WILLY NILLY, KELLY. >> SURE. WHAT IF AN EMPLOYEE IS -- THE EMPLOYEE IS IN THE CAFETERIA. AND HE SAYS, WHAT WAS THE SCORE OF THE BASKETBALL GAME? >> FOR SOME REASON SIRI CAN'T ANSWER IT. SURE. WHAT THEN? >> YEAH. THEN THE DATA GOES -- SO THAT IN THAT CASE, FIRST OF ALL, YOU'RE GIVING PERMISSION TO DO THAT. AND IT'S BEING VERY CLEAR, THIS IS NOT APPLE'S TECHNOLOGY DOING IT. IT'S JUST LIKE USING THE CHATGPT APP ON YOUR iPHONE. BUT SKINNED DIFFERENTLY ON THE INTERFACE BUILT NATIVELY IN iOS. THIS IS NOT EVERYTHING YOU DO ON YOUR iPHONE GOING OFF TO OPENAI SO THEY CAN ANALYZE IT AND TRAIN THEIR DATA ON YOUR DATA AND SO FORTH. THAT'S NOT WHAT HAPPENED HERE. >> YOU WOULD HAVE TO ASK SOMETHING MORE SPECIFIC TO YOUR COMPANY'S TRADE SECRETS, I SUPPOSE. SIRI SEEMS TO BE LISTENING ALL THE TIME. >> YEAH, EXACTLY. >> CAN APPLE ASSURE US SHE'S NOT GOING TO AUTO BACK END SOMETHING TO -- >> SURE. >> OPENAI OR CHATGPT WE DON'T SEND. >> I CAN TOTALLY GUARANTEE YOU THE RESEARCHERS ARE EAGER AND SOME COMMENTING ON THIS, KELLY. CYBERSECURITY RESEARCHERS LIKE THE ONE YOU HAD ON LAST HOUR AND SO MANY MORE ARE DYING TO GET THEIR HANDS ON THIS TO SEE IF THAT -- WHAT YOU JUST DESCRIBED IS HAPPENING. AGAIN, YOU HAVE TO PUT A LITTLE TRUST AND FAITH IN APPLE TO BELIEVE IT. AND YOU'RE TOTALLY RIGHT TO BE SKEPTICAL BECAUSE THIS IS UNPROVEN TECHNOLOGY. AND SO FORTH. BUT, YOU KNOW, MY READ INTO THE MUSK SITUATION WAS, YOU KNOW, FIRST OF ALL, HIS TWEETS WERE WRONG ABOUT THE WAY THIS PRODUCT WORKS. AND SECOND OF ALL, YOU KNOW, IT COMES OFF AS SOUR GRAPE. LET'S BE HONEST. HE DOES NOT LIKE OPENAI. HE IS SUING THE COMPANY OVER THE FACT THAT THEY'RE NOT FULFILLING THEIR NONPROFIT MISSION OR WHATEVER. WE'VE SINCE SEEN IN EMAILS AND SO FORTH THAT HE ACTUALLY WANTED OPENAI TO BECOME A PROFITABLE BUSINESS AND HAVE A BIGGER STAKE AND ALL THAT STUFF AND RAISE MORE MONEY AND SO FORTH. IT'S HARD TO TAKE HIM SERIOUSLY WHEN HE SAYS STUFF LIKE THIS. MAYBE HE WILL. MAYBE HE WILL FOLLOW THROUGH, BUT I DON'T TAKE IT SERIOUSLY. >> I THINK YOU SORT OF GIVEN THE LAST WORD BUT I'LL LET YOU GIVE ANOTHER LAST WORD AND THAT IS THIS. WOULDN'T A SIMILAR PROBLEM EXIST IF I WERE USING MY iPHONE, I GOT AN INSUFFICIENT ANSWER FROM SIRI AND I WENT TO GOOGLE AND ASKED THE SAME -- ASKED IT. ISN'T THEN THE DATA METASTASIZING OVER TO GOOGLE. >> AND THAT'S HAPPENING ON YOUR iPHONE RIGHT NOW. >> YES, THAT'S MY POINT. >> YEAH. SO GOOGLE IS THE DEFAULT SEARCH ENGINE, YOU CAN MAKE IT BING OR WHATEVER YOU LIKE TO USE. YES. IF SIRI CAN'T ANSWER THE QUESTION, IT KICKS YOU OVER TO A TRADITIONAL WEB SEARCH. THIS IS A DIFFERENT VERSION OF THAT. THIS IS AN AI VERSION OF THAT. IT'S NOT
