According to a report from The Information, Apple is looking to strengthen its AI capabilities by exploring the possibility of acquiring two leading AI startups Mistral AI and Perplexity (via MacRumors).
Unlike its usual restrained approach to mergers and acquisitions, Apple executives have weighed potentially multibillion dollar purchases. Services head Eddy Cue has emerged as a prominent advocate for these acquisitions, pointing to the strategic value of bringing in established AI talent.
Craig Federighi, Apple’s software chief, however, remains cautious, suggesting that delays and loss of control might come from pursuing large deals rather than building technology in-house.
Perplexity is a U.S based AI company offering a model powered search and answer engine that combines large language models with real time web indexing to deliver conversational answers along with source citations. It functions as a more transparent and structured alternative to conventional search engines.
The startup recently secured a multi-hundred million dollar round of funding placing its valuation between $14 and $18 billion depending on sources.
Mistral AI, meanwhile, is a Paris-based startup founded in 2023. It focuses on open weight large language models that are smaller in size yet fast and efficient, with strong capabilities in reasoning and code generation. It has been hailed as a European alternative to fast growing American AI firms such as OpenAI and Anthropic.
The timing of these potential moves may be linked to a pending court challenge to Apple’s $20 billion annual partnership with Google that designates Google as the default search engine on Apple devices.
Should that agreement be weakened or terminated, the company may feel pressure to integrate AI powered search capabilities from within its own portfolio.