Long-term beneficiaries of DeepSeek: Apple, Xiaomi, and others?

DeepSeek has had a huge impact on the global chip industry, while also bringing opportunities to other tech giants. Bank of America Merrill Lynch believes that if DeepSeek's technology can truly reduce the cost of AI inference, Apple will benefit in the long term from its advantages in edge AI technology.

The latest research report from the analyst team led by Wamsi Mohan at Bank of America Merrill Lynch points out that although Apple is currently focused on improving Apple Intelligence, its strategy remains very focused on enhancing user experience through edge AI. Unlike most large tech companies, Apple does not completely focus on cloud-based LLMs, but is committed to improving the inference capabilities of its end devices.

This strategy gives Apple's products a competitive edge in user experience, especially in terms of privacy protection and instant response. Therefore, Apple's devices, such as the iPhone, iPad, Mac, and Apple Vision Pro, are expected to integrate Apple Intelligence.

Bank of America Merrill Lynch believes that if DeepSeek's technology can truly reduce the cost of AI inference and improve the quality and speed of inference, then edge AI applications will benefit the most, providing multiple advantages to Apple.

First, Apple's edge AI applications will be further optimized, enhancing user experience. Secondly, as costs decrease, Apple can integrate more AI features into its products, such as smartphones and AR glasses. This will position Apple more favorably in future market competition as the ultimate choice with "LLM in your pocket."

Bank of America Merrill Lynch reiterates its buy rating on Apple, setting a target price of $253, about 10% higher than Monday's closing price.

In addition to Apple, tech giants like Xiaomi may also find new development opportunities in this trend. Although Bank of America Merrill Lynch did not mention Xiaomi in the report, its bullish logic also applies to Xiaomi. Xiaomi has been actively laying out its AI and Internet of Things strategies, with a product line covering various fields such as smartphones and smart home devices.

Additionally, there have been reports that Lei Jun has recruited DeepSeek's core researcher, post-95 AI genius Luo Fuli, with a salary in the tens of millions. This technical expert, who has published eight papers at an international conference, is expected to lead Xiaomi's AI large model team. This will undoubtedly provide Xiaomi with stronger AI support