Apple CEO Tim Cook holds up a new iPhone 17 Pro during an Apple special event at Apple headquarters on September 09, 2025 in Cupertino, California.
While many of the largest tech companies race to build massive data centers for their artificial intelligence ambitions, Apple is taking a more modest approach.
Instead of simply buying as many AI chips as possible, Apple buys computing capacity from outside partners, finance chief Kevan Parekh explained Thursday on the company's fourth quarter earnings call.
When Apple does build servers for its AI software, the company is using its own chips — not those from Nvidia or AMD — to power a service it calls Private Cloud Compute.
"I don't see us moving away from this hybrid model, where we leverage both first-party capacity as well as leverage third-party capacity," Parekh said.
Apple's results on Thursday closed out a busy week of earnings for the tech industry. Alphabet , Microsoft , and Meta reported on Wednesday, while Amazon reported on Thursday.
All of the companies said they planned to boost spending on capital expenditures to secure the computing capacity needed to develop next-generation AI and serve users.
Alphabet said it expects to spend about $92 billion on capital expenditures this year. Microsoft said it spent about $34.9 billion on capex during the September quarter and will spend more in capex for its fiscal 2026 than it did the year prior.
Meta stock got whacked after CEO Mark Zuckerberg defended the company's plan to spend about $71 billion on AI chips and other expenses in 2025. On Thursday, Amazon raised its 2025 spending forecast 6% to $125 billion.
Compared to them, Apple's barely spending at all.
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