Tech giant Apple seeks AI breakthrough as $30 billion Perplexity acquisition talks aim to reverse stock decline
Key Takeaways
- Apple stock down 20% in 2025 as the only Magnificent Seven member in the red, prompting urgent strategic moves to close AI gap
- $25-30 billion acquisition price discussed for Perplexity AI, nearly double the startup’s $14 billion valuation from its last funding round
- Revenue potential of $2.4-3.2 billion annually if Perplexity integrates across Apple’s 2.2 billion active devices, compared to current sub-$100 million ARR
Introduction
Apple faces mounting pressure to reverse its 20% stock decline in 2025 through a transformative AI acquisition. Bloomberg reports that Apple’s M&A chief Adrian Perica has held discussions about acquiring Perplexity AI, the search engine startup that handled 780 million queries in May alone.
The potential deal represents Apple’s most aggressive move to close its AI gap with competitors. Analysts estimate the acquisition could cost between $25 and $30 billion, positioning Apple to challenge Google’s search dominance while reducing dependence on existing partnerships.
Key Developments
Bloomberg reported on June 28, 2025, that Apple executives discussed acquiring Perplexity with services head Eddy Cue. The talks come as Apple explores partnerships with Anthropic’s Claude and OpenAI’s ChatGPT to enhance Siri, highlighting the company’s urgency to strengthen its AI capabilities.
Mark Gurman’s Power On newsletter details how Apple could afford the acquisition, citing the company’s $300 billion cash position. The discussions align with strategic pressure from ongoing antitrust concerns regarding Apple’s search partnership with Google, which generates significant revenue but faces regulatory scrutiny.
Perplexity has demonstrated strong growth momentum, with annual recurring revenue climbing from $34 million to $80 million by early 2025. The company plans a $500 million funding round to sustain expansion and market positioning.
Market Impact
Apple’s stock weakness stands in stark contrast to other Magnificent Seven members, with Benzinga Edge Stock Rankings showing poor momentum and value rankings at the 9.05th percentile. The company faces medium and long-term price trend challenges despite stronger short-term performance.
Analysts believe the acquisition could trigger significant stock movement. Tech bull Daniel Ives expects positive momentum if Apple finalizes the deal, calling it essential for the company’s future strategy after describing Apple as a “yawner” at WWDC 2025.
The AI search engine market projects substantial growth, with valuations expected to reach $108.88 billion by 2032. This backdrop intensifies competition for quality AI assets and validates premium acquisition pricing.
Strategic Insights
Acquiring Perplexity addresses multiple strategic challenges for Apple. The deal would reduce Google dependence while creating new revenue streams through search-based advertising, particularly important given potential antitrust decisions against Google by August 2025.
Integration across Apple’s ecosystem could transform Perplexity’s financial profile. Current sub-$100 million ARR could expand to $2.4-3.2 billion annually among Apple’s 2.2 billion active devices, representing a 24-32x revenue multiplication.
The acquisition enables Apple’s AI orchestration strategy, where users receive integrated responses rather than navigating between separate AI applications. This approach could differentiate Apple’s platform while competitors struggle with fragmented offerings.
Expert Opinions and Data
Daniel Ives from Wedbush Securities calls the acquisition a “no-brainer” for Apple’s future strategy. “It’s a matter of when and not if,” he stated on CNBC, emphasizing the urgency given Perplexity’s rising valuation and strategic ecosystem fit.
Alex Kantrowitz from CMSWire agrees the acquisition “makes perfect sense” for Apple, noting the necessity to act swiftly due to market dynamics and Perplexity’s increasing value. However, Bank of America’s Wamsi Mohan acknowledges strategic potential while highlighting integration challenges and Perplexity’s legal issues related to copyright infringement.
According to Forbes, the acquisition could redefine Apple’s strategic positioning, particularly enhancing products like Siri and Safari with advanced multimodal AI capabilities.
Jim Cramer supports the acquisition timeline, pointing to potential antitrust decisions against Google by August 2025. The urgency reflects external pressures including Perplexity’s budding partnership with Samsung and evolving market dynamics.
Conclusion
Tech Icons previously wrote about Apple’s potential Perplexity acquisition and that it represents a critical inflection point for the company’s AI strategy and stock performance. The deal addresses immediate competitive pressures while positioning Apple to lead AI orchestration across its ecosystem.
The acquisition’s success depends on overcoming integration challenges and regulatory hurdles. With Apple’s stock underperforming and AI competition intensifying, the company faces pressure to act decisively or risk falling further behind in the AI transformation.
