Apple shares sank 5% as a 202 billion dollar hit rattled faith in its AI. The move triggered a sharp market-cap loss and signalled a deeper Apple share price slump ahead.
Behind the price swing lies frustration with delayed Siri upgrades, patchy demos and vague timelines. Institutional buyers question whether Apple can justify premium iPhone pricing, while thinning margins chip away at investor confidence in its AI roadmap. Each fresh glitch, leaked test or rumour of internal delays adds fuel to growing AI setback fears and raises doubts about how quickly Siri can be turned into a compelling everyday assistant.
Market reaction to renewed doubts over Apple Intelligence
On Thursday, Apple shares slid about 5%, wiping roughly $202 billion from the company’s market capitalization after investors questioned the pace of Apple Intelligence. Dow Jones Market Data described the decline as Apple’s second-biggest, behind the $311 billion drop recorded on April 3, 2025.
The trigger was a Bloomberg story pointing to fresh delays and reliability worries around the Siri upgrade. That headline rippled through mega-cap tech, feeding a wider stock market selloff and souring Wall Street sentiment, while a sharp trading volume surge underlined growing tech sector jitters among short-term traders across US exchanges late in the session.
Inside the delayed Siri upgrade and its technical hurdles
Apple’s Siri team has spent more than a year building a far deeper voice assistant, unveiled at its Worldwide Developers Conference in June 2024. Executives initially targeted early 2025 for release, yet that carefully staged Siri enhancement timeline has slipped to “sometime this year” as engineers rework reliability and latency under heavy scrutiny.
Bloomberg reports that internal runs of the iOS 26.4 beta exposed stubborn AI integration issues, including moments where Siri defaulted to ChatGPT responses instead of Apple’s own language models. Test teams flagged fresh software testing problems, prompting a phased incremental feature rollout from iOS 26.5 in May through to iOS 27 this September for consumers around the globe.
Rising memory costs and what they mean for iPhone margins
Bernstein analyst Mark Newman argues that rising chip quotes are steadily compressing device economics at Apple. Tight AI server demand is straining memory and storage supply, so components for upcoming iPhones could run roughly 15% higher, adding visible component pricing pressure just as investors study how Apple Intelligence reshapes hardware profitability today.
Suppliers such as Micron, Seagate Technology and Western Digital reap strong AI server orders, a clear data-center demand impact that leaves fewer high-end modules for smartphone brands. Newman expects elevated memory bills to weigh on iPhone gross margins, yet he thinks Apple’s scale should cushion earnings per share far better than peers over the cycle.
How privacy commitments shape Apple’s AI rollout
Evercore ISI analyst Amit Daryanani sees the latest postponement as evidence that Apple will stretch schedules rather than relax privacy principles around Apple Intelligence. Company briefings emphasize an on-device processing focus wherever feasible, presented as a way to strengthen user data protection while running more capable language and vision models on iPhones and Macs across its ecosystem.
That philosophy now shapes Apple’s external deals, including AI model partnerships with OpenAI and Google’s Gemini that must abide by strict data-handling rules. Analysts say this careful, privacy-first product design helps explain the staggered Siri feature schedule, with cloud-dependent tools delayed until internal teams validate safeguards for users in every region.
