On July 10, Apple filed a lawsuit in the U.S. District Court for the Northern District of California against OpenAI, the OpenAI Foundation, OpenAI Benefit Corporation, OpenAI hardware subsidiary ioProducts (acquired by OpenAI in May 2025 at a valuation of approximately $6.5 billion, including the remaining stake acquisition valued at around $5 billion), as well as two former Apple executives: Tang Tan and Chang Liu.

Apple's allegations are serious: OpenAI systematically stole Apple's trade secrets to expand its proprietary hardware business.

The 41-page complaint reveals details including: Tang Tan, former Apple Vice President of Product Design, leaked supplier information to OpenAI while still employed and, after leaving, induced job candidates to bring prototypes, CAD drawings, and supply chain secrets to interviews. Chang Liu, former Senior Systems Electrical Engineer, refused to return his laptop after resigning in January 2026, exploited system vulnerabilities to illegally access Apple's internal network, and downloaded engineering files for unreleased products in bulk.

The complaint also highlights that over 400 former Apple employees have now joined OpenAI.

Just 14 months earlier, at WWDC 2024, Apple CEO Tim Cook had referred to OpenAI CEO Sam Altman as a 'pioneer and market leader' and announced the integration of ChatGPT into the iPhone.

Notably, this partnership initially did not involve direct cash payments from Apple to OpenAI. Instead, it operated on a 'distribution-for-exposure' model—ChatGPT was offered for free on Apple devices, with Apple taking a commission through the App Store for ChatGPT Pro subscriptions. OpenAI had hoped to significantly boost its paid user conversion rate, but the actual results fell short of expectations.

Now, the two companies have shifted from 'partners' to 'courtroom adversaries.'

Ironically, during their collaboration, Elon Musk had accurately 'predicted' that OpenAI would steal Apple's data.

1. The End of the Cook Era

In my view, the primary reason is that Cook's key lieutenants chose their own paths upon his retirement.

Tang Tan, a 24-year Apple veteran and former Vice President of Product Design, oversaw the design of major hardware products like the iPhone, Apple Watch, and AirPods. Apple's complaint alleges he possessed 'top-tier secrets about projects, supply chains, and manufacturing processes.'

After leaving Apple, Tang Tan co-founded io Products (acquired by OpenAI in May 2025 at a valuation of approximately $6.5 billion, including the remaining stake acquisition valued at around $5 billion), which was later acquired by OpenAI. He then became OpenAI's Chief Hardware Officer.

Apple accuses him of leaking supplier information to OpenAI while still employed and, after leaving, inducing job candidates to bring prototypes, CAD drawings, and supply chain secrets to interviews. He also allegedly coached departing employees on how to evade Apple's security reviews.

Chang Liu is another critical figure.

He worked at Apple for eight years as a Senior Systems Electrical Engineer. After resigning in January 2026 to join OpenAI, Apple repeatedly requested him to complete exit procedures, return equipment, and sign a confidentiality acknowledgment, but he never responded.

Apple also accuses him of refusing to return his computer after leaving, exploiting vulnerabilities to illegally access the internal network, downloading engineering files for unreleased products in bulk, and instructing current Apple employees to steal data.

The common thread: both were core figures in Apple's hardware ecosystem, both joined OpenAI shortly after leaving Apple, and both are accused by Apple of stealing trade secrets.

The complaint argues that OpenAI's hardware business, while 'still in its infancy,' is built on 'stolen trade secrets.' Apple demands the court order OpenAI to immediately cease infringement, destroy all products using Apple's secrets, and redesign upcoming hardware to ensure it does not incorporate Apple's technology.

This is not just a trade secrets case—it's Apple's direct counterattack against OpenAI's poaching of its talent.

The complaint explicitly states that OpenAI has hired over 400 Apple employees. For a company renowned for its culture of secrecy, this number is enough to trigger alarms.

2. Apple: Early to AI, Late to the Game

The timing is also delicate. OpenAI is preparing for its initial public offering, and Apple's lawsuit is like pouring cold water on OpenAI's credibility at this critical moment. Additionally, OpenAI's hardware ambitions, combined with Jony Ive's involvement, are forcing the market to reassess who this AI company's true competitors are. Apple's lawsuit is both a counterattack (counterattack) against infringement and a market statement.

The last thing Steve Jobs did before his passing was acquire Siri. Unfortunately, Tim Cook failed to build on this legacy. Launched in 2011 alongside the iPhone 4S, Siri was one of the most advanced personal voice assistants at the time. However, over the next decade-plus, Siri's evolution lagged far behind the market.

Technologically, Siri has long relied on a 'command-and-control' architecture rather than generative AI based on large language models. It's like an athlete who has learned fixed routines—capable of answering only preset questions and unable to engage in continuous dialogue or open-ended exchanges.

Former Apple engineers describe Siri's codebase as 'massive and clunky,' where adding a simple feature might require restructuring the entire database and take up to six weeks; complex updates could even take a year. Under this architecture, Siri struggles to understand context and complete complex tasks like ChatGPT.

From a user experience perspective, Siri has long been ridiculed as 'artificially stupid.' The old Siri could not handle complex instructions or continuous dialogue, forcing users to simplify their speech deliberately. Its Chinese recognition accuracy was low, it barely understood dialects, and it often misinterpreted casual spoken commands. Surveys even show that some users awaken (activate) Siri fewer than three times a month.

This is not just a technological gap—it's a failure in strategic iteration. While Amazon's Alexa, Google's Assistant, and domestic voice assistants like Xiao Ai and Xiao Yi evolved continuously, Siri's capabilities seemed stuck at checking the weather, setting alarms, and turning lights on and off.

Why didn't Apple develop its own large language model sooner? The core reason lies in Apple's organizational DNA. Apple has always been a 'product-driven' company, with technical research often serving specific products rather than pursuing breakthroughs in foundational technologies. Model training requires massive computational power, data, and talent investment—areas where Apple's layout (deployment) has been relatively slow.

After launching the Apple Intelligence platform, Apple hoped to compensate for its shortcomings with external large models. But this created a contradiction: Apple wants a smarter Siri but doesn't want to rely too heavily on third-party technology.

At WWDC 2026 in June, Apple introduced 'Siri AI,' claiming the new version abandons simple Q&A limitations and supports multi-turn continuous dialogue, context memory, cross-app interaction, and screen awareness. However, this release came more than three years after ChatGPT's debut.

While suing OpenAI, Apple replaced the underlying model for the new Siri from OpenAI to Google's Gemini—both a technical pivot and a nimble statement.

3. Cook's Final Dance

Apple's financial results for the second quarter of FY2026 (ending March 28, 2026) appear impressive on the surface.

The company reported $111.2 billion in revenue, up 17% YoY, setting a new March quarter record. Diluted earnings per share reached $2.01, up 22% YoY. Operating cash flow exceeded $28 billion.

All major business segments achieved double-digit growth. iPhone revenue set a March quarter record; Services revenue reached a new all-time high; Mac, iPad, and other product lines also performed strongly. The launch of the iPhone 17 series and iPhone 17e drove upgrade demand. The M4 chip-powered iPad Air and MacBook Neo expanded the premium product lineup.

The sustained growth of Services is particularly crucial. Apple's Services revenue now includes App Store commissions, iCloud storage, Apple Music, Apple TV+, Apple Pay, etc.—businesses with significantly higher gross margins than hardware. Services' share of total revenue continues to rise, helping Apple maintain stable overall gross margins amid hardware sales volatility. However, Services growth also depends on the hardware install base and user engagement; if iPhone sales slow, Services will face growth pressure.

Geographically, China's market rebounded sharply. Revenue in Greater China grew 28% YoY to approximately $21 billion, making it one of the standout regions in the earnings report.

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