Apple, Meta, and Google are locked in a fierce battle to lead the next wave of AI, and they’ve recently increased their focus on hardware. With its latest acquisition of the AI startup Q.ai, Apple aims to gain an edge, particularly in the audio sector.
As first reported by Reuters, Apple has acquired Q.ai, an Israeli startup specializing in imaging and machine learning, particularly technologies that enable devices to interpret whispered speech and enhance audio in noisy environments. Apple has been adding new AI features to its AirPods, including the live translation capability introduced last year.
The company has also developed technology that detects subtle facial muscle activity, which could help the tech giant enhance the Vision Pro headset.
The Financial Times reported that the deal is valued at nearly $2 billion, making it Apple’s second-largest acquisition to date, after buying Beats Electronics for $3 billion in 2014.
Notably, this is the second time CEO Aviad Maizels has sold a company to Apple. In 2013, he sold PrimeSense, a 3D-sensing company that played a key role in Apple’s transition from fingerprint sensors to facial recognition on iPhones.
Q.ai launched in 2022 and is backed by Kleiner Perkins, GV (formerly Google Ventures), and others. Its founding team, including Maizels and co-founders Yonatan Wexler and Avi Barliya, will join Apple as part of the acquisition.
The news comes a few hours ahead of Apple’s first quarterly earnings, in which analysts are estimating revenue at around $138 billion. It’s also expected to be the company’s strongest iPhone sales growth in four years.
This story was updated to reflect that the company is backed by GV. The article previously stated that Gradient Ventures was a backer.