10 billion yuan fee joins hands with Alphabet Inc. Class C (GOOGL.US) as a key catalyst! Analysts: Expected to drive Apple Inc. (AAPL.US) to surpass $400.

Technology industry analyst Dan Evans said that the market is waiting for Apple Inc. to come up with a clear artificial intelligence strategy, and a partnership with Alphabet could be the catalyst that investors are hoping for. "The current market expectation for Apple Inc. is the imminent collaboration with Alphabet Inc. Class C on AI. This is the key factor driving Apple Inc.'s stock price towards $400," Evans said in an interview. The day before Evans made his statement, reports emerged that Apple Inc. is planning to collaborate with Alphabet Inc. Class C's Gemini artificial intelligence model to provide technical support for an upgraded version of the voice assistant Siri, set to launch in the spring of 2026. According to sources, Apple Inc. plans to pay about $1 billion annually to access a high-performance artificial intelligence (AI) model developed by Alphabet Inc. Class C. This model, with 1.2 trillion parameters, will be used to fulfill Apple Inc.'s long-delayed promise to overhaul the underlying technology of Siri. After a lengthy evaluation process, both parties are reportedly finalizing the agreement. This move signifies that Apple Inc. will leverage Alphabet Inc. Class C's technology to revamp the core architecture of Siri, paving the way for the introduction of new features next year. The 1.2 trillion parameters of Alphabet Inc. Class C's model will significantly surpass the scale of Apple Inc.'s current model. Goldman Sachs Group, Inc. strategist David Costin shares Evans' viewpoint on the iPhone manufacturer. He said, "Dan Evans has pinpointed the core issue - the market is eagerly anticipating Apple Inc. to unveil a clear blueprint for AI development. If Apple Inc. and Alphabet Inc. Class C establish substantial collaboration in the AI field, its valuation framework will shift from hardware cycle-driven to platform monetization-driven." Evans also pointed out in the interview that Apple Inc. made a "major strategic mistake" by not pursuing relevant acquisitions. He said, "They could have acquired Perplexity (an AI startup) back then." Evans further added in the interview, "But now the situation is clear: Apple Inc. has no other choice but to make Alphabet Inc. Class C its comprehensive partner; and for Alphabet Inc. Class C, it's important to note that the annual revenue from (related business) could increase from $20 billion to $30 billion." Last week, Apple Inc. released its fourth-quarter financial report for the fiscal year 2025, which exceeded market expectations overall. Q4 sales increased by 7.9% year-on-year to $102.5 billion, slightly higher than the average expectation of $102.2 billion; earnings per share rose to $1.85, higher than the average expectation of $1.77. Driven by new models, iPhone revenue for Apple Inc. grew by 6.1% year-on-year, reaching $49 billion. However, this number was slightly lower than analysts' forecast of $49.3 billion.