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These two giants have different approaches to AI, with Amazon heavily investing in its AWS AI development and Apple focusing on leveraging partners like Alphabet for its ecosystem.
Amazon is making substantial investments in artificial intelligence, planning to spend $200 billion in capital expenditures in 2026, primarily on Amazon Web Services (AWS). This aggressive spending is aimed at maintaining AWS's leading position in the cloud business and developing its AI capabilities. CEO Andy Jassy views these investments as crucial for building a more meaningful business with strong returns as the AI market grows. AWS offers a comprehensive suite of AI services, including various large language models (LLMs) and products like SageMaker, designed to meet diverse enterprise demands. Amazon has reported robust overall sales growth of 14% year over year in the 2025 fourth quarter, with AWS sales increasing by 24% on an already large base.
Apple has adopted a different AI strategy compared to its tech counterparts, opting not to develop its own large language model. Instead, it has partnered with Alphabet to integrate the Gemini LLM to power a revamped Siri, expected to launch in the coming months. Apple's strength in AI lies in its vast ecosystem of 2.5 billion active devices, where users are highly engaged with AI services through Apple's hardware. This prudent approach allows Apple to enhance user experience without the massive capital outlays seen from other hyperscalers. The market is beginning to recognize the wisdom in Apple's strategy, appreciating its focus on leveraging existing infrastructure and partnerships to advance its lead and reinforce its position through user loyalty and strong engagement.
Choosing between Amazon and Apple as the better AI stock is a difficult decision, as both tech giants offer significant investment potential for a diversified portfolio. Apple represents a more conservative investment approach, ideal for those seeking AI exposure combined with long-term value and reliability. Conversely, Amazon is considered a more aggressive AI play, with its substantial investments in AWS AI development holding the potential for significant growth and stock appreciation. The choice ultimately depends on an investor's risk tolerance and investment strategy for gaining exposure to the burgeoning AI market.