Apple Debuts AI-Powered iPads

Launch anticipation builds amid market challenges

Apple's share price has been volatile this year as it lags behind its peers in artificial intelligence (AI) innovation.

The company's lowest recorded share price in 2024 was US$165 on April 19, 11 percent below US$185.64, where it started on January 2. iPhone sales were on the decline in the first three months of the year, particularly in China, where locals are opting for rival brands Huawei and Xiaomi (OTC Pink:XIACF, HKEX:1810).

Apple’s iPad business has also slowed in the last few years. Sales have been declining, possibly due to an oversaturated market, competitive products from other companies and a longer-than-usual upgrade cycle. The most recent iPad and iPad Pro models were released in October 2022 , and the most recent iPad Air — the sleeker, thinner version with a slightly larger screen and a more powerful chip — came out in March of that year. The company’s Q2 earnings report, released on May 2, shows that iPad sales dropped by 16 percent year-on-year compared to the predicted 11 percent.

The announcement of Apple's Let Loose event, reported by Bloomberg on April 23, caused a noticeable rise in the company's share price. Shares surged again in after-hours trading following the release of its Q2 earnings, which were slightly above analyst estimates, and news that the company would be issuing the largest share buyback in US history.

Apple’s share price opened this week at US$182.37 on Monday (May 6), and remained relatively steady leading up to the Let Loose event, which took place at 10:00 a.m. EDT on Tuesday. Unlike previous Apple events, Let Loose took place before US markets closed, perhaps to allow European and Asian customers a chance to watch in real time.

Apple unveils new iPads and M4 chip

As mentioned, Apple unveiled a range of new products and updates at Let Loose, including new iPads, the new M4 chip, new iterations of its fresh AI capabilities and upgrades to its accessories.

First up were a redesigned 11 inch and new 13 inch iPad Air, both powered by Apple’s M2 chip. The smaller of the two tablets will start at US$599, and they will both be available on May 15.

Upgrades to the product line include high-resolution Liquid Retina displays, faster Wi-Fi connectivity and back and landscape front-facing cameras with AI-enabled Center Stage technology that uses machine learning to keep everyone within view during FaceTime calls. The company also shared other new AI capabilities, with an Auto Enhance tool in Photomator for easy photo-quality improvement and motion tracking on Onform to optimize athletic performances. The iPad Airs also have integration with cloud-based apps like Microsoft Copilot, 365 and Adobe Firefly.

Alongside these products, the company announced the launch of its new iPad Pro, its thinnest iPad yet, measuring just 5.1 millimeters in thickness. It will also be available on May 15, and is priced at US$999. This version comes with the most advanced screen technology to date, the Ultra Retina XDR display, made possible by two OLED panels working in tandem to provide vivid colors, a precise contrast ratio of 2,000,000:1 and a peak brightness of 1,600 nits.

The iPad Pro is powered by Apple’s new M4 chip, which was also unveiled at the event. The M4 chip uses advanced 3 nanometer technology and features a new display engine to support the Ultra Retina XDR. Its central processing unit has up to 10 performance and efficiency cores, allowing it to perform complex tasks up to 1.5 times faster than the M2 chip.

Additionally, its 10 core graphics processing unit is equipped with machine-learning accelerators and features Dynamic Caching, an innovative addition to the M3 chip family that allows for real-time memory allocation, improving overall efficiency. Finally, the chip includes a 16 core neural engine, Apple’s fastest to date, enabling on-device machine learning.

As for accessories, Apple introduced a new Magic Keyboard with a built-in trackpad that attaches magnetically to the iPad, as well as a more precise Pencil Pro. The Pencil Pro comes with a sensor that lets users easily switch between tools, change colors and adjust line weight. The new model will come integrated with the Find My app.

In addition to hardware, Apple added Final Cut Pro, enhanced with new AI features to help users improve the quality of their photos and videos, to iPad for the first time. Other AI components include Live Multicam, which lets users capture up to four angles of the same scene. Final Cut Pro will also be available to download on Mac 10.8.

Finally, the company added new AI features to Logic Pro, its digital audio workstation. The additions include Session Players, which delivers AI-driven backing drums, bass and keyboards; Stem Splitter, which lets artists separate mixed audio recordings to add effects or make changes; and ChromaGlow, which enhances music production by modeling the sounds of high-end studio hardware using AI and lets artists add them to their tracks.

The new version of Logic Pro will be available for iPad 2 on May 11 and for Mac 11 on May 13.

Low-key market reaction to Apple's news

The market’s reaction to the Apple's product launch was subdued, with shares initially declining from US$184.79 and then moving back up as the presentation went on to US$184.35. From there, Apple's share price continued a mostly downward trajectory with sporadic blips, reaching the day’s lowest point of US$181.39 just after noon. The company closed the day at US$182.40, with no discernible movements observed after hours.

Ben Bajarin, an analyst for research firm Creative Strategies, said he’s “not concerned at all” with the market’s relatively quiet reaction to this week's news. "We've gotten glimpses of what's next but everybody realizes it's not around the corner," he told Max Zahn for ABC News. "It'll take many years to flesh that out."

Likewise, Dan Ives, managing director of equity research at investment firm Wedbush, said in a note that analysts are now looking forward to the Worldwide Developers Conference in June, for which Apple has been teasing a major announcement related to its AI development. "We believe the seeds for an Apple growth turnaround are being planted in the field by Cook & Co," he said.