Long before Taco Tuesday became part of the pop-culture vernacular, Tuesdays were synonymous with security — and for anyone in the tech world, they still are.  Patch Tuesday, as you most likely know, refers to the day each month when Microsoft releases security updates and patches for its software products — everything from Windows to Office to SQL Server, developer tools to browsers.

The practice, which happens on the second Tuesday of the month, was initiated to streamline the patch distribution process and make it easier for users and IT system administrators to manage updates.  Like tacos, Patch Tuesday is here to stay.

In a blog post celebrating the 20th anniversary of Patch Tuesday, the Microsoft Security Response Center wrote: “The concept of Patch Tuesday was conceived and implemented in 2003. Before this unified approach, our security updates were sporadic, posing significant challenges for IT professionals and organizations in deploying critical patches in a timely manner.”

Patch Tuesday will continue to be an “important part of our strategy to keep users secure,” Microsoft said, adding that it’s now an important part of the cybersecurity industry.  As a case in point, Adobe, among others, follows a similar patch cadence.

Patch Tuesday coverage has also long been a staple of Computerworld’s commitment to provide critical information to the IT industry. That’s why we’ve gathered together this collection of recent patches, a rolling list we’ll keep updated each month.

In case you missed a recent Patch Tuesday announcement, here are the latest six months of updates.

July’s Patch Tuesday sees an end-of-support collision amidst a massive, record-setting patch wave

Microsoft addressed 722 CVEs this month once the 427 Chromium upstream relays are set aside — roughly three times a normal cycle and one of the largest single months in recent memory. Two vulnerabilities arrive under active exploitation: an elevation of privilege in Active Directory Federation Services (CVE-2026-56155), and an elevation of privilege in SharePoint Server (CVE-2026-56164). A third, a BitLocker security feature bypass (CVE-2026-50661) is publicly disclosed but not yet exploited.

The July 2026 Patch Tuesday earns Patch Now recommendations for Windows, Office, Exchange, and SQL Server. SharePoint has two critical RCEs on top of its exploited zero-day, and Exchange Server returns with a critical on-premises spoofing flaw. Adding to our (dear) administrator’s efforts, SharePoint Server 2016/2019 and SQL Server 2016 all reach end of support today. The Readiness team has provided a handy infographic of the expected risk profile of this month’s Patch Tuesday updates.

More info is available here on Microsoft Security updates for July 2026.

For June, Patch Tuesday means an IT scramble

Microsoft this month released 206 updates affecting Windows, Office, Exchange Server, and its developer tools — including three Windows vulnerabilities already publicly disclosed. That trio includes an elevation of privilege in the Collaborative Translation Framework (CVE-2026-45586), a denial of service in HTTP.sys (CVE-2026-49160), and a BitLocker security feature bypass (CVE-2026-50507). At the moment, none appear to be under active exploitation, but all three are rated “Exploitation More Likely.” 

Even without an exploited zero-day, the June 2026 Patch Tuesday release requires Patch Now recommendations for Windows, Office, and Exchange. The latter is back in the patch picture with a consolidated security update that Microsoft recommends installing “as soon as possible.”

More info is available here on Microsoft Security updates for June 2026.

For May, Patch Tuesday means 139 updates — but no zero-days

Microsoft this month released 139 updates affecting Windows, Office, .NET, and SQL Server (though there were no updates for Microsoft Exchange Server). Despite the absence of zero-days, the May Patch Tuesday update still requires Patch Now recommendations for Windows and Office. 

The combination of three unauthenticated network RCEs (Netlogon, DNS Client, and SSO Plugin for Jira and Confluence), four Word Preview Pane RCEs, the large TCP/IP vulnerability cluster, and the carry-over BitLocker recovery condition (still active on Windows 10 and Windows Server) warrants an accelerated deployment release schedule. 

More info is available here on Microsoft Security updates for May 2026.

Microsoft’s Patch Tuesday release for April is a whopper

Windows admins are going to be busy this month, dealing with the largest Patch Tuesday cycle in memory. The April release involves 165 updates and roughly 340 unique CVEs from Microsoft — including two zero-days, one of which is already being actively exploited in the wild. 

The Readiness team recommends “Patch Now” schedules for nearly every major product family: Windows, Office (with a zero-day), Microsoft Edge (Chromium), SQL Server, and Microsoft Developer Tools (.NET). April also brings Phase 2 of Microsoft’s Kerberos RC4 hardening with full enforcement set for July. There is a lot to cover, so here’s a useful infographic mapping the deployment risk for each platform.

More info is available here on Microsoft Security updates for April 2026.

For March, Patch Tuesday delivers fixes for 83 vulnerabilities

Microsoft’s March Patch Tuesday release addresses 83 vulnerabilities across Windows, Office, SQL Server, Azure, and .NET — with two publicly disclosed zero-days affecting SQL Server and .NET (though neither is being actively exploited in the wild.) Six additional vulnerabilities spanning the Windows Kernel, Graphics Component, SMB Server, Accessibility Infrastructure, and Winlogon are flagged as “Exploitation More Likely.”

The most significant change this month is the introduction of Common Log File System (CLFS) hardening with signature verification, which will affect how Windows handles log files across the operating system. More info on Microsoft Security updates for March 2026.

February’s Patch Tuesday release fixes 59 flaws, including 6 being exploited

The company’s Patch Tuesday release for February addresses 59 CVEs across the company’s product family — roughly half the volume of January’s 159 patches. Six vulnerabilities, affecting Windows Shell, MSHTML, Desktop Window Manager, Remote Desktop, Remote Access, and Microsoft Word, are already being actively exploited. (All five Critical-rated CVEs target Azureservices rather than Windows, however.) 

Both Windows and Office get a “Patch Now” recommendation, with CISA setting a March 3 enforcement deadline for all six exploited vulnerabilities. Two new enforcement timelines also take effect in April: Kerberos RC4 deprecation (CVE-2026-20833) and Windows Deployment Services hardening (CVE-2026-0386). More info on Microsoft Security updates for February 2026.

Microsoft addressed 722 CVEs this month once the 427 Chromium upstream relays are set aside — roughly three times a normal cycle and one of the largest single months in recent memory. Two vulnerabilities arrive under active exploitation: an elevation of privilege in Active Directory Federation Services (CVE-2026-56155), and an elevation of privilege in SharePoint Server (CVE-2026-56164). A third, a BitLocker security feature bypass (CVE-2026-50661) is publicly disclosed but not yet exploited.

The July 2026 Patch Tuesday earns Patch Now recommendations for Windows, Office, Exchange, and SQL Server. SharePoint has two critical RCEs on top of its exploited zero-day, and Exchange Server returns with a critical on-premises spoofing flaw. Adding to our (dear) administrator’s efforts, SharePoint Server 2016/2019 and SQL Server 2016 all reach end of support today. The Readiness team has provided a handy infographic of the expected risk profile of this month’s Patch Tuesday updates.

(More information about recent Patch Tuesday releases is available here.)

Known issues

The July release note flags known issues against the following updates:

• BitLocker recovery prompt on first restart – the PCR7 recovery condition tracked since April remains live on the platforms that did not receive the Boot Manager servicing fix (Windows Server 2022 and Windows 10 22H2). Devices with BitLocker on the OS drive, the Group Policy “Configure TPM platform validation profile for native UEFI firmware configurations” set with PCR7 included, and Secure Boot State PCR7 Binding reported as “Not Possible” may be prompted for the recovery key on the first restart after installing this update. This month’s publicly disclosed BitLocker security feature bypass (CVE-2026-50661) keeps the component in focus.

• WSUS synchronization error details suppressed (Windows Server 2025 and 2022) – WSUS no longer displays synchronization error details in its error reporting, a deliberate change made to address the Remote Code Execution Vulnerability CVE-2025-59287. Sync still works, but administrators triaging a failed synchronization lose the detail pane and must fall back to the SoftwareDistribution logs.

Windows Update can still replace manually installed graphics drivers with older OEM versions from the catalogue (the four-part Hardware ID ranking issue acknowledged on the Hardware Dev Center). The two-part HWID pilot runs to September 2026.

Major revisions and mitigations

Between the June and July Patch Tuesdays, MSRC Security Update Guide notices updated 651 reported CVEs across six notification dates (15, 19, 26 June and 3, 8, 11 July), 532 of them routine Chromium upstream re-publications. Of the roughly 30 Microsoft revisions, almost all were cross-platform Office catch-up with no bearing on a Windows enterprise estate. No further action required for IT administrators for this Windows update cycle.

Windows lifecycle and enforcement updates

This is the deadline cycle June pointed at. The July end-of-support wave lands today, and it collides with the month’s heaviest patching. SharePoint and SQL Server take some of their most active security updates ever on platforms receiving their last.

• SharePoint Server 2016 and 2019, Project Server 2016 and 2019, SQL Server 2016 and InfoPath 2013 have all reached end of support. SQL Server 2014 ESU Year 2 reaches end of support today. SharePoint 2016/2019 take an actively exploited zero-day and two RCEs this cycle, and SQL Server 2016 takes a critical RCE, all as their final security update. Now is the time to get moving on updating these platforms.

The 2011 Secure Boot certificate expiries have now passed; devices that never took the Windows UEFI CA 2023 key updates under CVE-2023-24932 can no longer receive updated boot components, with the Windows Production PCA for the boot manager still ahead on 19 October 2026. Kerberos RC4 hardening (CVE-2026-20833) has been in enforcement since April 2026; the July 2026 update removes the RC4DefaultDisablementPhase rollback control that let administrators defer it, making enforcement final.

Microsoft’s July 2026 Patch Tuesday is a security-only release: 180 test-guidance entries, 14 of them high risk (June had one). Printing and graphics are the centre of gravity: win32kfull.sys, the kernel-mode window manager, is the most-patched binary (14 entries), and seven high-risk flags sit alongside it – the Print Spooler, four win32k entries, and two GDI+ metafile entries. NTFS is the second theme, with 10 entries, two high risk. Every entry reports no functional changes – it’s pure regression validation. The packages span Windows 11 26H1 back to Server 2012 ESU.

Printing and graphics (high risk)

The Print Spooler flag centres on shared printers, whose queue status must track jobs accurately; the win32k flags cover 32-bit application printing, font rendering in printed and exported output, on-screen rendering, and window management; the GDI+ flags cover metafiles.

• Share a printer from a print server, print from a separate client in varied sizes and formats, and cancel a job, confirming the queue reflects every state change
• Print from your 32-bit applications, and print text-heavy, graphics-heavy, and multi-page documents to physical and virtual (PDF or XPS) printers, repeating after orientation, scaling, and resolution changes
• Export documents with varied fonts to PDF and confirm fonts and layout survive; render EMF+ files that apply effects to very large images, and convert EMF files to WMF
• Open and close windows rapidly, drive common dialogs by mouse and keyboard, and close parents with children open – no orphaned windows

Storage and file systems (high risk)

Both NTFS high-risk flags target integrity – extended attributes, and volume recovery after an unexpected shutdown. File History carries its own high-risk flag on clients. A Windows Server 2025-only bundle across boot, BitLocker, and ReFS demands the full Secure Boot/BitLocker matrix. Eight entries hit Server 2025 alone, including WSL, GPU partitioning, and a scripted Windows Server Backup pass repeating recovery after rolling the date 90 days forward.

• Exercise NTFS extended attributes – older-system EAs, backup workflows that preserve them, concurrent same-file operations where supported – with antivirus, encryption, or storage filters active
• Simulate an unexpected shutdown during file activity, verify the volume mounts intact, run chkdsk, and confirm indexing, shadow copies, and backup still work
• Run a full File History pass: back up, modify and back up again, exclude folders, change frequency, move the destination
• On Server 2025, boot all four Secure Boot/BitLocker combinations, in standard and confidential VMs where supported

Devices, input and networking (high risk)

Three further high-risk flags land here: HID input (hidparse.sys with win32k) – touch, keyboard, mouse, touchpad, through disconnects and restarts; the WinSock bundle (afd.sys plus Bluetooth and multicast drivers); and IrDA. The heaviest ask is not high risk at all: the NetAdapterCx driver (24H2/25H2, Server 2025) wants 500-plus adapter enable-disable cycles under Driver Verifier.

• Run the connectivity suite: browsing, large downloads, mapped drives, an RDP session idle 30+ minutes, a Teams call, an hour of streaming, and localhost apps such as Docker or WSL
• Stress Bluetooth: pairing, 10+ minutes of audio, input after idle, and reconnection after sleep
• Where infrared hardware exists, transfer a file and run at least 100 connect-disconnect cycles
• Sweep the rest: DNS Server (zone data must stay under its configured database directory), the client resolver (five entries), DHCP Server (five entries), SMB, NFS, Message Queuing (five entries), RRAS administration, client VPN, and WinHTTP/WinINet consumers

Other windows components

Windows Installer itself is patched: testing should include application install, uninstall, repair, and force a rollback. Hyper-V wants virtual-switch traffic as part of its testing exercises with Virtual Filtering Platform policies enforced. Sixteen media-related security entries cover playback, HEVC and MPEG-TS, USB audio, and MIDI 2.0.

Shell hardening and LSA isolation

These two entries are a little different from the rest of the cycle: they ask you to confirm a security behaviour actively works, not just that nothing regressed. A pass here means the protection fired, so treat them as functional checks rather than box-ticking.

• Shortcut handling (windows.storage.dll; Windows 11 23H2 and earlier, plus Server 2022): drop a shortcut file carrying the Mark of the Web into a folder and confirm the system refuses to extract its icon and leaks no NTLM credential hash – include the zero-click paths, where the icon would otherwise render without you opening anything
• LSA isolation and KeyGuard (24H2/25H2, Server 2025): run the supplied PowerShell validation script, which turns on Virtualization-based Security if it isn’t already, exercises KeyGuard key operations in both required and best-effort isolation modes, and reports pass or fail – it needs TPM 2.0, UEFI with Secure Boot disabled, and PowerShell 7
• Run that script on a dedicated test machine, never a shared one: it enables test signing, disables automatic updates, and reboots without asking

Office & SharePoint

July’s Office wave is security-only; everything landed on 14 July, and nothing critical or non-security shipped in the 7 July preview. It’s an MSI-only cycle, so Click-to-Run estates can sit this one out.

• On MSI Office 2016, apply the client updates – Excel (KB5002886), Word (KB5002890), PowerPoint (KB5002867), and five further Office 2016 security updates (KB5002273, KB5002887, KB5002748, KB5002857, KB5002830) – then exercise macros, external data, embedded objects, and any line-of-business add-ins
• On SharePoint Server, patch 2016 (KB5002891, plus the KB5002892 language pack) and Subscription Edition (KB5002882), then check browser-based editing; the guidance lists SharePoint 2019 with a baseline but ships no 2019 package, so there is nothing to install there

Mind the rollback rules before you schedule the window: most client updates can be uninstalled, but the server updates cannot and always require a reboot.

Developer tools & databases

The developer estate gets a broad but low-drama sweep this month. Both .NET and SQL Server patch widely, but the ask is representative-application validation rather than anything exotic – install on the matching branch and confirm normal behaviour.

• .NET: install the SDK updates (8.0.423, 9.0.316, 10.0.302, x64 and x86) and the Framework rollups spanning 3.5 through 4.8.1 – which reach from Windows Server 2012 up to Windows 11 26H1 and Server 2025 – then run a representative set of applications and confirm they function normally
• SQL Server: the GDR updates span 2016 SP3 through 2025 – install each on its matching branch and test that each removes cleanly
• Check an encrypted client connection through the separately patched Windows SQL client (dbnetlib.dll), which ships outside the server branches

The Readiness team recommends the following priorities for your larger enterprise deployments:

• Start with printing and graphics: half the high-risk flags sit in the Print Spooler, win32k, and GDI+, so regress shared printers, 32-bit printing, PDF export, metafiles, and window management before anything else
• Take NTFS next – extended attributes and crash recovery both touch data integrity – and add a client File History backup-and-restore pass
• Give Server 2025 its wider matrix – the Secure Boot/BitLocker combinations, WSL, GPU partitioning, and the scripted backup pass – and work through the stress suites
• Run the scripted KeyGuard validation on any VBS estate, preferably on a dedicated machine.

Each month, we break down the update cycle into product families (as defined by Microsoft) with the following basic groupings:

• Browsers (Microsoft IE and Edge)
• Microsoft Windows (both desktop and server)
• Microsoft Office
• Microsoft Exchange and SQL Server
• Microsoft Developer Tools (Visual Studio and .NET)
• Adobe (if you get this far)

Browsers

Edge has had a busier month than usual. Microsoft addressed 46 Microsoft Edge (Chromium-based) CVEs this cycle. None critical, but heavily weighted to remote code execution (21 entries) and spoofing (13), led by CVE-2026-58289, a remote code execution flaw. A run of further RCEs (CVE-2026-57981, CVE-2026-56645, CVE-2026-57974) follows.

• Microsoft Edge – the Edge-specific fixes ship in the Edge stable channel (version 150.0.4078.65, released 9 July). The concentration of RCE and spoofing this month is worth a look for managed Edge estates rather than a routine wave-through.
• Chromium upstream – 427 CVEs relayed through MSRC this cycle, spanning the weekly Chrome release cadence since the June report: use-after-free, out-of-bounds read/write, type confusion, and inappropriate-implementation flaws across V8, Dawn, ANGLE, Skia, and Tint. The same fixes ship in the Chrome Stable channel; see the Chrome releases blog for the upstream notes.

The Chromium volume looks (quite) alarming but is routine plumbing: it flows to Edge through its own auto-update channel. Add these browser (Edge) updates to your standard release schedule for your managed environments.

Microsoft Windows

Windows carries the bulk of this month’s updates: 406 CVEs, 31 rated critical and 374 important. Elevation of privilege dominates by volume (226 entries), followed by remote code execution (70), information disclosure (70), denial of service (23), and a scatter of security-feature-bypass, tampering, and spoofing entries across the following feature groupings:

• DHCP – the standout network cluster: DHCP Server remote code execution (CVE-2026-50518, “Exploitation More Likely,” and CVE-2026-56159), with further critical DHCP Server and DHCP Client RCEs behind them (CVE-2026-48564, CVE-2026-50370, CVE-2026-54128). DHCP servers are the deployment priority.
• VMSwitch and Hyper-V – the Windows VMSwitch elevation of privilege (CVE-2026-57092) is one of the month’s highest-severity flaws, joined by two critical Hyper-V elevation-of-privilege entries (CVE-2026-50680, CVE-2026-54127), guest-to-host risk on virtualisation hosts.
• Network stack RCE – a Windows Server Network driver RCE (CVE-2026-56188, “Exploitation More Likely”), plus TCP/IP (CVE-2026-54999), the Reliable Multicast Transport Driver (CVE-2026-54982), and SSTP (CVE-2026-50694).
• Graphics – Windows GDI+ remote code execution (CVE-2026-50380) and a DirectX Graphics Kernel RCE (CVE-2026-50382), both reachable through document-rendering paths.
• Windows Media – a large cluster: three critical Media Foundation RCEs (CVE-2026-57090, CVE-2026-57094, CVE-2026-57087) lead 14 Windows Media and seven Media Foundation entries overall.
• Identity infrastructure – beyond the exploited ADFS flaw, Active Directory Domain Services takes a critical RCE (CVE-2026-49164) and Active Directory Certificate Services a critical elevation of privilege (CVE-2026-54121). Domain controllers take priority again.
• Print Spooler, WSUS, and MSMQ – critical RCE/EoP in the Print Spooler (CVE-2026-58608), Windows Server Update Services (CVE-2026-50444), and Message Queuing (CVE-2026-54992, “Exploitation More Likely”), all server-role attack surface.

The Windows Kernel is the most-patched component (28 CVEs, seven “More Likely”), followed by NTFS (21), Windows Runtime (17), Windows Media (14), ReFS (12), and Win32k (15 across its two entries). Add this Windows update to your Patch Now deployment schedule.

Microsoft Office

Microsoft released 96 Office CVEs this month: 19 critical, 76 important. Remote code execution leads (53 entries), ahead of information disclosure (27) and spoofing (10). SharePoint is the centre of gravity: it touches 39 of the 96 CVEs and supplies the family’s one actively exploited flaw.

• SharePoint Server: has been exploited (who would have guessed) and reaches end of support today. CVE-2026-56164, an elevation of privilege, is under active exploitation. Above it sit two critical remote code execution flaws, both “Exploitation More Likely” (CVE-2026-50522, CVE-2026-58644) and a critical security feature bypass (CVE-2026-55040). SharePoint Server 2016 and 2019 reach end of support on 14 July, so this exploited, critical-heavy set is the final security update those on-premises farms will receive.
• Office has experienced a long run of critical remote code execution entries across Office, Word, and PowerPoint (among them CVE-2026-55033 and CVE-2026-55127 in Word, CVE-2026-55043 in PowerPoint, and CVE-2026-55018 in Office), topped by CVE-2026-55045.

With an exploited zero-day, two RCEs, and an end-of-support deadline all landing on SharePoint in the same cycle, SharePoint environments are the priority. Add the July Office and SharePoint updates to your Patch Now schedule.

Microsoft Exchange and SQL Server

Both Exchange and SQL Server carry critical-rated security vulnerabilities this month. Exchange Server returns with an on-premises security update for Exchange Server Subscription Edition, the only on-premises release still supported after Exchange Server 2016 and 2019 reached end of support in October 2025; SQL Server takes two critical remote code execution flaws, one of them against SQL Server 2016, which reaches end of support on the same day.

• Exchange Server (on-premises) – CVE-2026-55008, a spoofing vulnerability rated critical and “Exploitation More Likely,” is the headline. Behind it, a remote code execution entry (CVE-2026-55005) and two elevation-of-privilege flaws (CVE-2026-55006, CVE-2026-55009) round out the on-premises set. A separate Exchange Online elevation of privilege (CVE-2026-54998, critical) is fixed service-side with no customer action.
• SQL Server – two critical remote code execution flaws: CVE-2026-54117 (SQL Server 2025) and CVE-2026-54118 (which reaches back to SQL Server 2016 SP3), with five further important elevation-of-privilege and information-disclosure entries behind them. The 2016 exposure matters because SQL Server 2016 reaches end of support on 14 July: a critical RCE on a platform taking its final update.

Both belong on the Patch Now schedule this month: the Exchange on-premises update for its critical spoofing flaw, and the SQL Server update for the two critical RCEs.

Microsoft developer tools

Microsoft released 24 CVEs across its developer tooling this month, all rated important. The weighting shifts from last month’s Visual Studio Code concentration toward .NET and ASP.NET Core, where a run of denial-of-service entries dominates the volume:

• ASP.NET Core and .NET – the two highest-severity entries are ASP.NET Core elevation-of-privilege entries (CVE-2026-47300, CVE-2026-47303), ahead of a .NET security feature bypass (CVE-2026-50528) and two .NET / .NET Framework remote code execution flaws (CVE-2026-50646, CVE-2026-50649).
• Visual Studio and VS Code – a GitHub Copilot / Visual Studio Code security feature bypass (CVE-2026-41109) and a second VS Code security feature bypass (CVE-2026-57102) lead here, with a VS Code remote code execution entry behind them (CVE-2026-50520) and a Visual Studio RCE (CVE-2026-47305).

Add these Microsoft updates to your standard developer update release schedule.

Adobe (and third-party updates)

Outside Microsoft’s own catalogue, July is quiet. Adobe issued no Acrobat or Reader security updates. So, the month belongs to Microsoft, and it is a heavy one: 722 CVEs, roughly three times a normal cycle and one of the largest on record. Worth noting that this lands in the same season Microsoft has been talking up AI-assisted vulnerability management, and the AI stack it is selling as the answer, Copilot and Azure OpenAI among them, sits in the centre of this patch cycle’s own critical-rated updates. The (AI) tooling may be getting smarter, but the patch pile is (definitely) not getting smaller. This may be the beginning of an accelerating curve of ever larger patch cycles. My feeling is that we are in the middle of the beginning of this coming patch surge.

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Dozens of former Apple employees now working at OpenAI have been put on notice after Apple reportedly sent legal letters ordering them to preserve documents and communications relevant to its trade secrets lawsuit against OpenAI. 

The Financial Times reports that “around 40” employees have been targeted with these letters, which repeat Apple’s claim that its confidential information might have been exfiltrated, alleging “trade secret misappropriation and breach of contract.”  The letters also require them to arrange to meet with Apple’s lawyers.

The underlying lawsuit

This comes on the heels of Apple’s explosive lawsuit against OpenAI in which Apple accused the AI company (and former Apple Vice President Tang Tan) of extensive coordinated data theft. Tan was at Apple for 24 years and is now Chief Hardware Officer at OpenAI. 

Apple’s lawsuit is defined by claims OpenAI took a range of steps to pry confidential Apple data from existing Apple employees, including using information such as internal project code names, to gain even more knowledge during interviews. The company says the evidence it has presented so far is only the “tip of the iceberg” concerning OpenAI’s approach.

The lawsuit requests that OpenAI be prevented from using any Apple information during the development of its hardware. Apple is also seeking damages and suing two former employees for breach of contract for violating their employment agreements.

The letters are significant. They represent formal directives that require former Apple staff to preserve documents, messages, emails, and other communications that could be relevant to the case. The demand reflects Apple’s belief that the alleged misuse of confidential information could be more widespread across the competing company. What’s critical is that orders of this kind override any standard data destruction policy and deletion of the requested information becomes a legal offense. 

Why this matters beyond the protagonists

In making its move, Apple shows this is not a dispute about just one or two hires, but an attempt to constrain the movement of intellectual property between the two firms. With AI hardware emerging as the next major battleground in tech, the case could become a defining one; whatever resolution is eventually reached could define the extent to which former employees can carry experience and knowledge between competing firms. The case might also define what the line is between experience and knowledge and the sharing of trade secrets.

This is important, because modern hardware development relies on far more than just finished designs. Product design leans into supplier relationships, manufacturing assumptions, physics, extensive prototyping, and product-roadmap priorities. If courts treat those accumulated insights as protectable secrets, hiring between major technology companies could become far more legally sensitive.

The Jony Ive question

The case comes as Apple prepares to combat OpenAI in hardware. Its competitor is now working with legendary former Apple designer Jony Ive. Ive is not named in the litigation, but Apple will be keen to find out whether confidential product knowledge, design processes, or supply-chain insights have travelled with former staff into OpenAI’s device work.

Ultimately, for Apple, it’s about protecting its many blueprints for whatever hardware the company expects will come after the iPhone.

For its part, OpenAI has refuted Apple’s lawsuit, arguing that it is “not aware of any evidence” that the lawsuit has merit. “We have no interest in other companies’ trade secrets,” said OpenAI spokesperson Drew Pusateri. “We remain focused on building innovative technology that empowers people everywhere.” The company’s lawyers also claim it did respond to Apple’s initial inquiries on the matter.

What’s at stake

The significance of Apple’s newly-shared communication preservation orders is that if discovery uncovers evidence supporting Apple’s claims, the case could complicate OpenAI’s hardware plans and create unwelcome scrutiny ahead of any future public offering.

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Apple’s recently announced $30 billion multi-year agreement with Broadcom is significant because it means billions of chips for Apple devices will be made in the US, supporting hundreds of jobs. 

This is Apple’s biggest US procurement deal so far, but it won’t be the last; when it announced the arrangement, Apple confirmed it is, “working with the administration and businesses across the US to help create an end-to-end silicon supply chain in America.”

That statement implies that the 15 billion chips Broadcom will produce won’t be the only processors in Apple devices to carry tiny little “Made in the USA” slogans. Broadcom is making custom silicon components and wireless connectivity technologies such as RF/wireless chips (Wi-Fi, Bluetooth, cellular, FBAR filters) and ASIC work, rather than application processors. But they are still chips for Apple devices.

TSMC doubles down

That’s why it is significant that TSMC confirmed plans to extend its own manufacturing in America. It already has a $165 billion US commitment; now, it is investing an additional $100 billion in four more chip plants — including one dedicated to churning out the company’s most advanced 2nm (and smaller) processors. 

“We believe this investment will help to further foster the development of the US semiconductor ecosystem, strengthen the supply chain, and support an increasing number of high-tech, high-paying jobs in the United States,”  CEO C.C. Wei told analysts.

TSMC has also confirmed plans to invest in packaging facilities for processors, which is basically the process where memory, processor, and networking nodes can all be combined and packaged on the chip. That sort of packaging is needed to make the final SoC chip. That means TSMC factories in the US will be able to churn out the advanced processors used in Apple’s current and, presumably, future devices.

The bill so far

That’s three investments — in processor manufacturing, packaging, and Broadcom radios and chips — all of which are strategically important to Apple devices. TSMC makes the brains, Broadcom brings the connectivity. Total value so far: $295 billion, around 1.5 times Apple’s annual revenue in the Americas.

It isn’t all about Apple. TSMC has other clients, and Apple is no longer the company’s biggest customer thanks to the drive to AI. But it is still an important one. That means at least some of TSMC’s newly invested US manufacturing capacity will be dedicated to making chips for Apple. The open question is how much US-manufactured chips will cost in contrast to those made elsewhere.

It’s bigger than two deals

These aren’t the only chip-focused partnerships Apple has made domestically. Apple’s American Manufacturing Program (AMP) launched in August 2025 as part of a $600 billion four-year US investment commitment. TSMC and Broadcom were both named AMP partners, but they weren’t alone, and some arrangements have already been announced:

• GlobalFoundries is bringing mixed-signal chip manufacturing to make advanced ICs for Face ID.
• Texas Instruments expanded production for analog/power chips.
• Samsung is making a new chip-making process at its Austin, TX fab, described by Apple as having “never been used before anywhere in the world.”
• Apple became the “first and largest customer” of Amkor’s new advanced packaging/test facility in Arizona.
• Corning is expanding glass production.
• Applied Materials is making chip manufacturing equipment under AMP.

Bundle all these deals together and it’s crystal clear that Apple’s $600 billion investment is at least in part focused on the technologically advanced components on which its devices are built. These components also have the advantage in being incredibly small, which means they are easy and cheap to ship for final assembly at increasingly automated final production locations worldwide. 

So, is it coming home?

That’s the strategy: keep the high-value, hard-to-automate work — and the jobs it requires — in America, while leaving final assembly flexible enough to go wherever that makes sense now or in the future. Is Apple bringing manufacturing home? Partially, in that the bits that matter the most — brains and networking— are coming back, even if assembly is not.

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Zoom has identified, and patched, a critical security hole that “may allow an unauthenticated user to conduct an account takeover via network access.”

The issue is especially significant given Zoom’s extensive reach; it reportedly has more than 300 million daily active users, including 470,000 paying business customers. Given that reach, Zoom has been impacted by many other security incidents and France recently tried banning its use by French government users. 

 Zoom security bulletins released Tuesday revealed the bug, and three other security issues, which Zoom patched on Wednesday. 

The company originally said that the takeover issue impacted Zoom Desktop Client for Windows before version 7.0.0, Zoom VDI Client for Windows before version 7.0.10 and 6.6.15 and 6.5.18 in their respective branches, and Zoom Meeting SDK for Windows, but on Wednesday, without explanation, it removed Meeting SDK for Windows as an affected product.

The other three holes were less severe, but still significant, and they all involved privilege escalation. They impacted Zoom Workplace for Windows before version 7.0.5, Zoom Workplace VDI Client for Windows before 6.5.17 and 6.6.14 in their respective branches, Zoom Workplace VDI plugin for Windows before 6.5.17 and 6.6.14 in their respective branches, Zoom Rooms for Windows before 7.0.5 and Remote Control for Zoom Contact Center for Windows before version 7.0.0.

A second privilege escalation issue impacted Zoom Rooms for Windows before version 7.1.0, and another impacted Zoom Workplace VDI Plugin for Windows before version 6.6.14.

Zoom did not immediately reply to a request for comment.

‘As bad as it gets’

Frank Dickson, group VP for security at IDC, said the nature of the reported hole is alarming.

This bug “is about as bad as it gets, short of a worm. It is exploitable over the network, low complexity, zero privileges required, no user interaction needed,” he said, pointing out that exploitation is easy once technical details leak or someone reverse-engineers the patch, which is not as challenging as it once was, thanks to AI. “Yesterday’s script kiddies have been empowered,” he said.

Dickson said the only good news is that Zoom discovered the hole itself, and that “no in-the-wild exploitation has been reported by any outlet as of Thursday.”

Consultant Brian Levine, executive director of FormerGov, agreed with Dickson’s characterization of the hole, but said a potentially bigger issue is the high level of sensitive data that Zoom accesses. 

“An attacker with unfettered access to a Zoom account may be able to listen to recordings of sensitive meetings, to eavesdrop on future meetings, and to impersonate the organization in an effort to social engineer its clients and partners. Thus, given that ubiquity of Zoom in large enterprises, this vulnerability is pretty concerning,” Levine said.

He’s encouraged, however, that Zoom found the flaw itself, which indicates its security team is “actually doing the hard, unglamorous work of auditing its code.”

Giuseppe Trotta, principal security researcher at Malwarebytes, has a theory about what was behind the Zoom disclosure. 

“Because the vulnerability requires zero privileges and absolutely no user interaction, the remote network attack vector is highly suspected to involve the mishandling of deep links, such as custom URL schemes like zoommtg:// or zoomworkplace://,” he said. This led him to think that if the Zoom Workplace client for Windows fails to properly sanitize and validate incoming arguments passed via these special browser-to-desktop links, an unauthenticated attacker could craft a malicious string that could trick the desktop application into exposing or redirecting the user’s active session tokens directly to an attacker-controlled server, achieving a seamless and completely silent account takeover.

“Watch out for Zoom links and invites if you are on Windows or VDI and haven’t updated yet,” he advised.

Mike Wilkes, enterprise CISO at Aikido Security, offered kudos to Zoom for discovering the critical flaw, but he wanted to know how such a severe bug got into its software initially.

“This vulnerability raises questions about why the defect was not caught by design review, fuzzing, or pre-release abuse-case testing,” Wilkes said. “A historical defect in Zoom’s product/security relationship has been prioritizing ease of use over security risk.”

All four bugs important

Justin Greis, CEO of consulting firm Acceligence, said that the two types of holes reported by Zoom, account takeover and escalation, are both important, but for different reasons. 

“The critical vulnerability is significant because it has the characteristics security teams worry about most,” Greis said, but the privilege escalation holes “are certainly important to patch as they primarily increase the impact of an attack that has already begun. The critical vulnerability has the potential to be an initial entry point, which is why it deserves the most attention.”

Greis also applauded Zoom’s response, saying that it “reflects a reasonably mature security program.”

He pointed out that no complex software platform will eliminate vulnerabilities entirely. “The differentiator is whether vendors are continuously investing in offensive testing, finding weaknesses before attackers do, and moving quickly to develop and distribute fixes,” he said.

When Apple sued OpenAI last week, the argument it made was that former employees had stolen Apple data and then used it to benefit OpenAI. 

The technical details — an employee used “a rare, previously unknown authentication bug to access Apple’s shared network folders” — are interesting. But the larger story is Apple’s ridiculous attempt to stop its people from using anything they learned at Apple in other jobs.

“Hiring managers don’t mind some files being brought into the org during onboarding, but suddenly take umbrage when that same employee exits with some files later on,” said Mike Wilkes, enterprise CISO at Aikido Security. “Legal should be equally concerned about both events.”

The lawsuit focused on Chang Liu, an employee who had been recruited to work at OpenAI after working at Apple for eight years as a Senior System Electrical Engineer. The full text of the filing depicts a comedy of errors by Apple, offering the perfect “do not do” list of handling employee resignations — especially when they’re going to a direct competitor. 

“When Apple contacted Mr. Liu to sign Apple’s confidentiality reminder, schedule an exit interview, and confirm that he had returned his devices and complied with other exit procedures, Mr. Liu did not respond.” And “after leaving Apple, Mr. Liu failed to return an Apple-issued work laptop that he had previously authenticated to Apple’s network.”

First, typical procedure for handling departures is to tie the return of all equipment and the signing of documents to any final payments. With Apple, that is likely to be a large amount of money. The lawsuit does not say whether Apple exerted any financial pressure on their employee for compliance. 

But in terms of equipment with high-level access, why weren’t all privileges revoked, both for the employee and any and all company-issued devices? Did they not maintain a remote-wipe capability for these devices? Although remote-wipe is usually used when devices are missing or stolen, it should work as well when a departing employee refuses to return company equipment. 

According to Apple, Liu apparently had help at Apple from Tang Yew Tan, who was supposedly also interviewing with OpenAI. “While employed by OpenAI, [Liu] accessed and used his former colleague’s Apple-issued work computer that was authenticated to Apple’s network, without Apple’s authorization.”

Apple tried to make much of this Liu’s fault. Legally, yes, there might be liability there; still, Apple made itself look as if it couldn’t protect its own data. “Upon discovering that he had this unauthorized access to Apple’s systems, [the former employee] did not report it, return his stolen Apple-issued work laptop or delete the program that allowed the access.” 

Really, Apple? Your data-protection plan relies on ex-employees to “delete the program that allowed the access”? I’m not so sure you didn’t bring some of this data-leakage on yourselves. 

This gets worse: “Over several weeks, while developing hardware for OpenAI, Mr. Liu surreptitiously accessed and downloaded dozens of Apple’s confidential hardware-related files, including voluminous, detailed information about unreleased products, engineering presentations, technical specifications, and proprietary project data.”

Setting aside the issue of privileges, access, and unreturned equipment that apparently had its own privileges, that statement points to massive data exfiltration from Apple systems. Even if it is coming from a current employee, why didn’t that raise any red flags? 

Let’s get back to the broader implications. When professionals move from one company to another, they — of course — are bringing their experience and knowledge with them. Can Apple reasonably tell them that they can’t do so? Isn’t that experience and knowledge exactly why another company would want to hire them?

Now, to be sure, stealing diagrams and product spec sheets is a clear violation. Let’s say Apple spent a lot of money on some hardware research projects. A member of that technical team would learn an awful lot, all on Apple’s dime. 

But is it fair and reasonable for Apple to say that the former employee can’t leverage that knowledge at his or her next job? 

This brings us back to the point Wilkes made: If Apple is going to try to prevent any former employee from leveraging on-the-job experience, then it should instruct all new employees not to use anything they learned in a previous job. 

That would be ridiculous. Companies pay for experienced talent because of that experience. Why pay for expertise if you insist employees not leverage any of it?

Then there’s the amorphous nature of knowledge. So, it’s wrong to take detailed diagrams and spec details and hand them over to a new employer. But what if that worker heading out the door memorizes the documents (photographic memory) a day before resigning? Is a person prohibited from using something from memory?

There’s also the fruit-of-the-poisonous tree legal argument. Even if a former employee doesn’t directly use stolen data, what if their knowledge leads to other money-saving insights for the new employer? 

Given that Apple hires as many specialists as it loses to rivals, wouldn’t it make sense to leverage everything your workforce knows and then let new employers do the same? But before you do that, Apple, tighten your exiting employee tech controls. 

Then maybe you wont’t have to file lawsuits like this down the road.

OpenAI’s first device will be a screenless home AI system that can play music, control appliances, and respond to messages and questions, according to Bloomberg. I can’t help but ask what makes this device different from Apple’s HomePod with SiriAI?

The OpenAI product is intended to be the first of a family of solutions and is expected to use the recently-introduced GPT-Live large language model (LLM). The latter is an advanced model capable of processing information swiftly and of providing natural responses to conversations. 

A potential gold mine for hackers

This expertise might help it deliver more accurate responses to requests, though the information could also become a gold mine for data brokers, hackers, and advertisers if there turns out to be any way they can get their hands on it. It’s not yet known how — or even if — OpenAI proposes protecting user privacy within its systems. 

The device, which is still under development, is explained as being a home companion that also includes a built-in camera and sensors so it can gather contextual information about where you are, becoming an expert on you and your needs. It also features autonomous mechanical elements that physically shift on their own, intended to give the product a “personality,” rather than being a boring black box.

Can we live without this?

While OpenAI’s development is not yet complete and things could change before it reaches market, based on Bloomberg’s report I’m not terribly clear how unique it is going to be. After all, as LLM support is introduced in existing smart speaker systems from Apple, or even Amazon, what unique features does this device bring that consumers can’t live without? More particularly, what problems does it solve and why does it exist?

Manufacturing economics

What’s also unclear is how far along OpenAI is on the road to mass manufacturing the device. Apple’s recent lawsuit against OpenAI confirmed the challenger is speaking with Apple’s own manufacturing partners as well as hiring hundreds of Apple engineers. Despite the talent war, I consider it unlikely OpenAI will be able to lock in the kinds of manufacturing deals it needs to bring the product to market at an acceptable price. 

That suggests either that its inaugural “home companion” will seem incredibly expensive (as so many of the products Jony Ive has designed since leaving Apple seem to be), or that OpenAI will sell these things at a subsidy. 

Bloomberg suggests the systems will cost $200 to $300. That seems low given the current component market, expected design quality and the technology used if the plan is to make something good. And it leaves me wondering how deeply investors will underwrite hardware sales, given the eye-watering losses the company is already making.

Apple’s trade secrets case

Given ongoing speculation that Apple plans something similar in the form of a hybrid HomePod/iPad equipped with AI and limited mobility, the recent lawsuit strongly suggests Apple feels some of OpenAI’s plans cross the line into using proprietary technologies and ideas Cupertino has spent years pursuing. Apple’s lawsuit seems to bring much more meaningful evidence than just an argument concerning product design. 

Betting the farm on Ive

We also don’t know the extent to which consumers will be open to semi-sentient AI devices lurking in their lives. While Apple can lean into its loyal customer base and broaden its offering with rock-solid promises concerning user privacy, OpenAI has less to bring to the launch party.

That means it is attempting to pivot millions who use its services into investing in its hardware. It presumably hopes that it will be able to drive that transition by using the design involvement of acclaimed Apple designer Jony Ive as a form of magic talisman. 

The challenge is that while Ive is a big name in Apple history, Apple users are extremely loyal and may react against the involvement of their favorite designer. It’s like finding out someone you thought was on your team actually supported someone else. 

It will be different outside Apple, where less loyal cohorts might see the product introduction as a chance to put a design from Ive through its paces without signing up to a Mac, iPhone, iPad, or HomePod. 

For the rest of us, the question will be whether OpenAI’s Ive-designed product channels the successful design ethic of the iMac, or that of the far less successful hockey puck mouse. Like (timely World Cup klaxon) France against Spain, OpenAI’s investors have to hope the best version of Ive’s design principles show up, because their risked fortunes potentially depend on it. 

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Passkeys have been around for some time, but enterprise-wide adoption to this point has been slow for a number of reasons. But soon, many Microsoft customers won’t have a choice.

Starting September 1, Microsoft will roll out passkeys as the default authentication method in its cloud-based identity and access management (IAM) service Entra ID. And following a transition period, Microsoft-provided SMS and voice authentication will officially end on February 1, 2027.

With this move, Microsoft seems to be underlining the urgent need for a more secure authentication standard, as attackers up their game with AI.

This is an “important milestone,” because it moves passwordless authentication from an optional security enhancement to the expected standard, noted Ensar Seker, CISO at SOCRadar. “That shift is significant as attackers increasingly rely on AI to automate phishing campaigns, generate convincing login pages, and conduct large-scale credential theft.”

Microsoft’s six-month passkey roll-out

Passkeys require users to authenticate via a fingerprint, facial scan, or lock screen mechanism, rather than a password. They can be stored on physical USB keys (like YubiKey), or as digital credentials on computers, phones, or in cloud accounts.

This method, Microsoft contended, reduces reliance on phishable authentication tools like SMS and voice, and hardens protection against credential theft.

Passkeys “work better for users and worse for cyberattackers,” Nadim Abdo, Microsoft corporate VP for identity and network access engineering, wrote in a blog post.

Microsoft’s announced timeline for rolling out passkeys is relatively aggressive:

• September 1, 2026: All SMS or voice-enabled users will be “auto-enabled and nudged” to register a passkey upon multifactor authentication (MFA) sign-in.
• September 18, 2026: Pricing, commercial terms, and a list of supported telecom providers will be shared for scenarios that still require SMS or voice authentication due to regulation or technical or operational challenges.
• October 30, 2026: Enterprises still using SMS and voice must select and configure a supported telecom provider through the Microsoft Security Store. From then on, they will be responsible for any telecom-related costs.
• February 1, 2027: Microsoft-provided telecom delivery for SMS and voice authentication ends as a native Microsoft Entra capability.

After February 1, enterprises that require SMS or voice for MFA must register a passkey before sign-in. There will be no opt-out option.

It’s important to note that these dates apply to public cloud-hosted Entra ID. Support for other cloud environments will follow a separate timeline; additional guidance and dates are to come.

While SMS and voice have served their purpose well, Abdo said, bringing MFA to billions of users who otherwise would have had none, the threat environment has changed in “speed, scale, and sophistication,” necessitating this move to passkeys.

The benefits of passkeys

SOCRadar’s Seker pointed out that passkeys fundamentally change the attack surface because, unlike with passwords, there is no transmission of shared secrets that can be stolen by threat actors. Authentication requires possession of the user’s device, along with biometric verification or a PIN.

“Even highly convincing AI-generated phishing pages cannot simply trick users into handing over a passkey the way they can with passwords or one-time codes,” he said.

So why haven’t we seen widespread enterprise adoption? Identity ecosystems are “fragmented,” Seker noted, and many enterprises still rely on legacy applications that only support passwords. They also struggle with cross-platform compatibility, lifecycle management, recovery processes, shared accounts, and employee onboarding and offboarding.

Further, “until recently, many organizations viewed passkeys as a consumer technology rather than an enterprise identity strategy,” he said.

Microsoft’s move changes that equation, because Entra sits at the center of many organizations’ identity infrastructure, Seker noted. Default settings are typically the strongest drivers of security adoption, so when passwordless authentication becomes required rather than optional, organizations are far more likely to deploy it at scale.

Its biggest benefit would be a “dramatic reduction” in credential-based attacks, Seker said. He pointed out that most successful compromises still begin with stolen credentials obtained through phishing, infostealer malware, password reuse, or adversary-in-the-middle attacks. Passkeys “eliminate or significantly reduce” many of those attack paths, while reducing password fatigue and the help desk costs related to password resets.

In addition, rather than trying to continuously improve users’ ability to detect increasingly sophisticated phishing attempts, passkeys remove the credential from the equation altogether, Seker noted. “That represents a more sustainable long-term security strategy than relying solely on user awareness training.”

Still, passkeys are not a silver bullet, as they do not stop endpoint compromise, session token theft, malicious insiders, or attackers who already have control of a trusted device. Enterprises must complement passkeys with endpoint protection, continuous monitoring, conditional access policies, and identity threat detection, Seker advised.

How enterprises can prepare

To prepare for the shift to passkeys, Microsoft advised enterprises to review their authentication policy and identify the groups still using SMS or voice authentication. They should then select the best authentication method for user devices and workflows, and ensure all employees are given passkeys and security keys.

Entra ID supports both synced passkeys (those stored in platform credential managers like iCloud Keychain and Google Password Manager), and device-bound passkeys such as Microsoft Authenticator passkeys, Entra passkey on Windows, or FIDO2 security keys.

Seker advised enterprises to evaluate support for FIDO2 and passkeys across their identity infrastructure, and to develop clear enrollment and recovery procedures. They should also educate users on what’s changing, how passkeys work, and how they can complete registration. Further, Seker said, it’s important to establish secure device management practices and to continue enforcing least privilege, conditional access, and risk-based authentication policies throughout the transition.

Ultimately, he pointed out, the move is crucial. “Over the next several years, organizations that continue relying primarily on passwords will likely face higher operational risk as AI continues to lower the cost and increase the effectiveness of credential-based attacks,” he said.

Apple has released the first public betas of its “27” series of operating systems, and feedback so far suggests they’re already very stable builds, even at this early end of the release cycle. 

For most intrepid public beta testers, the big attractions here are Siri AI and the heavily improved Apple Intelligence tools – though Siri AI is not yet available in Europe due to regulatory problems there. Overnight social media commentary has been highly positive, with Siri widely seen as delivering on what we always thought it should be rather than the limited product it became.

Caveat emptor

Once installed, the new operating system is fast and better performing on the iPhone, though there are some limitations anyone considering the beta should consider first:

• This is beta software; things can and sometimes do go wrong. So don’t install it on your primary device unless you know how to restore your device and its data.
• Some critical apps such as banking tools, VPNs and some smart home management software are reported to be unstable at times.
• Once the public beta is first installed, there’s a lengthy period during which your device will rebuild its database; this can take many hours and performance will be affected.
• As the OS beds in, users might experience sudden battery drain or the device might seem warmer than usual.
• You’ll need to join a lengthy Siri waitlist before you can install the updated Siri AI.
• Siri AI requires significant hardware capabilities and only runs on iPhone 15 Pro, iPhone 16 and iPhone 17 models. Alternatively, you must have an M1 or later Mac or an iPad running an M1 chip or later, or A17 Pro (iPad mini).

Siri AI is a big improvement

Siri AI is the big reward here. Joanna Stern called it “significantly better.” It will provide you with much better responses than its predecessor, and its contextual understanding is sophisticated and advanced. 

That’s because Siri can search across your messages, emails, photos and more to help you find what you’re looking for and has some understanding of where you are and what you are doing to help it make even more accurate decisions. It is faster than it’s ever been with a dedicated app (which includes logs of your interactions) and a new glowing design when activated. 

The assistant can now hold an ongoing conversation with you, understands what’s on screen, and take some actions in apps. One way that might be useful is if you are looking at a recipe online, you can ask Siri to write up a shopping list for the recipe ingredients and paste it in a Note. Siri has become much more knowledgeable than in the past thanks to its expanded and updated world knowledge database.

Apple Intelligence has been beefed up, too, with keyboard tools much improved on the last version. Siri can even reflect your personal tone and style based on the person you’re communicating with when sending a Mail or Messages post. 

Apple and the image

The Camera app now has a new Siri mode; it can do things like identify objects and people, or import event details from a leaflet. You can easily search or ask questions about what’s around you, and there are useful new actions you can take, such as getting nutritional insights about a plate of food.

Image Playground wasn’t terribly impressive when it first appeared, and a lot of people did little with it. It seems much better now, capable of generating photo-realistic images in virtually any style from natural language prompts or editing existing images. It’s a useful step up.

Another impressive feature is Spatial Reframing. This lets you shift the composition of a photo after you’ve taken it, using AI to create accurate renditions of what is outside the frame. A new Extend tool lets you expand images, which is useful for adjusting aspect ratios or creating Lock Screen wallpapers.

The future on your wrist

If you use an Apple Watch, you’ll be impressed, as the contextual AI extends to that device. So, you can have context-savvy conversations with your watch and ask it to do tasks on your behalf. It makes it feel like a bona fide computer on your wrist and bodes well for other future wearable products from the company. 

There are lots of other interesting features in the beta. Call Context can automatically surface the information you need, like a confirmation code or reservation number, when calling up a business. And a new Notify Me feature in Safari lets you know when a web page changes, so you can watch for stock availability or ticket sales.

How to install the beta

If you’re interested in installing the new OSes, Apple’s Beta Software Program website should be your first port of call. You’ll need to sign in to access the betas using your Apple Account. Once you’ve done that, open Settings and go to Software Update; there you can select Beta Updates and choose the 27 series Public beta. Tap Update Now and the installation will begin.

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Microsoft’s big lead over AI competitors like Google and others has vanished, and the company is now playing catch-up. As a result, Microsoft’s stock has tanked in the last year — down roughly 23% compared to a year ago, due mainly to its massive AI spending and an inability to monetize Copilot. 

The company clearly needs to do something. And last week it did, though not what you might expect. It laid off 4,800 people, a little more than 2% of its worldwide workforce, with its Xbox division hit hardest. And it’s not reducing its massive spending on AI data centers or other AI-related costs.

The New York Times explained the cuts this way: “It is Microsoft’s latest employee culling as it plows tens of billions of dollars into the infrastructure for building artificial intelligence.”

Was cutting back on gaming (while still going all-in on AI) the right move for Microsoft? To answer that, let’s take a look at the details of the company’s July layoffs.

A year of layoffs

The recent cuts come in the wake of larger Microsoft workforce reductions over the last year or so. In May 2025, the company laid off 6,000 employees, about 3% of its workforce. Then a few months later, it laid off 9,000 more, about 4% of its workers. In both rounds of cuts, the company’s gaming division was hit — though it wasn’t the primary target.

This year, in April and May, the company rolled out its first voluntary retirement program for US employees. Approximately 3,000 people took the money and ran.

Then came last week, when Microsoft primarily targeted gaming. When the cuts take full effect over the next year, 2,850 gaming employees will be let go. In addition, Microsoft is cutting loose several of its gaming studio brands, which will become independent companies or be sold to buyers.

The layoffs hit the two remaining gaming studios, Activision Blizzard, which makes the big-selling games Call of Duty and Candy Crush, and ZeniMax Media, which publishes series including Fallout and The Elder Scrolls. Three years ago, in 2023, Microsoft bought Activision Blizzard for $69 billion. That followed its purchase of ZeniMax Media in 2020 for $7.5 billion. Both seemed like sizable acquisitions at the time. 

Compared to Microsoft’s AI spending now, they’re chump change.

Follow the money

A memo sent to employees about the July layoffs by Amy Coleman, Microsoft executive vice president and chief people officer, made clear the layoffs were more about AI than they were about gaming. 

Of the cuts, she wrote: “The “why” is this: our business is changing because the world around it is changing. The way technology is built, deployed, and used is transforming faster than at any point in my time here. Our customers’ needs are shifting, the business models that serve them are shifting, and that means the work itself — what we do, where we focus, and how we’re organized — has to transform, too.

“Our customers are navigating this same shift, and they’re counting on us to help them through it.”

That last sentence is an oblique reference to the early July launch of the Microsoft Frontier Company, which will embed 6,000 engineers inside customers’ businesses to help them more effectively deploy AI. The cost: $2.5 billion.

That sounds like a substantial amount of money. But it’s only a drop in the bucket of how much money the company plans to spend on AI. In April, Microsoft told investors it would spend $190 billion on data centers and other AI infrastructure this year, a 60% increase over what it spent last year. At the same time, Microsoft said it would shrink its workforce.

Its latest layoffs are clear-cut evidence of that. It’s also evidence that the company recognizes how badly Xbox has performed, and that it needed to do something about it. 

In early June, Microsoft sent a memo to everyone in its Xbox division entitled “Next 100 Days: XBOX Reset.” The memo laid out the problems with its ailing game business and pulled no punches. It noted that beyond the $69 billion the company spent three years ago to buy Activision, “Over the past five years, we have spent over $20 billion on ongoing investments in our content, platform, and hardware subsidy, but our annual revenue has declined nearly half a billion during that time. Going forward, this cannot continue.” 

The layoffs and spinoffs were the first steps. They won’t be the last.

There’s no doubt this is just the beginning of Microsoft’s disinvestment in gaming. The issue isn’t just that the company’s investments haven’t paid off. It’s that Microsoft’s AI ambitions are so large and expensive that it can no longer afford to seriously fund gaming.

Ultimately, it was the right thing to do, at least from a business perspective. The future is AI. It’s not in gaming.

So, for the foreseeable future at Microsoft, when it comes to AI — the sky’s the limit. But when it comes to gaming, things look much less rosy.

Except for the second user/refurbished smartphone markets, AI means the days of cheap phones are over, with huge price pressures putting low-end vendors out of business. 

Omdia data confirms that Apple and Samsung are undisputed kings of the hill, combining for 42% of the market even as smartphone sales overall have seen a 4% average decline. 

The two companies increased market share by 4% (Apple) and 2% (Samsung) compared with 2Q25. Meanwhile, the situation is becoming much worse for smaller vendors as memory prices spiral, leaving their businesses under immense strain. Data from Counterpoint Research tells a similar story, indicating Apple growth against a background of market decline. 

It’s important to put the impact of raised RAM costs into perspective. While Apple and Samsung make products at the kind of scale that enables them to cut better deals, smaller makers don’t have the same advantage, leaving them far more exposed to memory price driven pressures.  

Memory prices are crushing the low end

And they really are exposed; not only are sales declining, but Omdia analyst Runar Bjorhovde notes that vendors at that end of the market are dealing with hugely destructive DRAM price hikes over just the past year — up to four or five times higher in some cases. That degree of increase is the kind of business-focused tsunami that drives people out of the market altogether and certainly leaves companies exposed to M&A activity.

Right now, memory and storage can account for more than 60% of the product cost, Bjorhovde said. And as costs continue to increase, what profitability that does exist in the low-cost, high competition lower end smartphone space is being utterly mauled. Omdia forecasts a 22% decline in the sub-$400 smartphone segment as a result.

“Samsung Electronics and Apple — the two market leaders — made huge market share gains…, whereas most players beyond went through steep volume declines,” Bjorhovde said.

From volume to value

Apple’s decision to expand its addressable market with the iPhone ‘e’ series just adds pressure, while Samsung’s enduring popularity helps make it difficult for smaller vendors to generate profit through market scale. “To adapt, vendors are shifting their strategies from volume to value by reoptimizing portfolios and adjusting retail pricing,” he said. 

“Although memory and storage costs are the biggest challenges for vendors, they are far from the only challenge,” Bjorhovde said. “New semiconductor bottlenecks, such as within foundries, are adding further cost pressures.”

With the cost of manufacturing set to continue to rise, it’s generally accepted that we’ll see the average selling price of smartphones climb in the coming 12 months, with Apple set to lead the market toward higher cost builds with the new Pro and Ultra iPhones this September.

Apple’s decision to hold smartphone prices so far has added another price pressure to low-end vendors; the longer it holds its prices down, the longer and more painful will smaller vendors hang onto their own low-price structure to compete.

Future shock: AI hardware

A further wild card is in Apple’s recent lawsuit against OpenAI, which accuses the ChatGPT maker of “illegal reliance on misappropriated trade secrets” in its hardware plans. OpenAI is thought to be planning an AI-driven iPhone competitor.

We’ve heard speculation about these plans before, of course. But what seems to be emerging in the wake of Apple’s litigation are hints OpenAI intends to introduce its first AI hardware product at some point in 2027.

Assuming that schedule remains on track, OpenAI will likely impose further component pricing pressure across the whole industry. After all, Apple’s customer loyalty leads the industry, and Samsung has built something similar. So, the companies with the most to lose to OpenAI will be the same set of smaller vendors who are already struggling with component price-driven market complexity.

OpenAI products will demand the same memory, similar processors, manufacturing, and other components as other devices, prompting further pricing pressure. That’s likely to put some small vendors out of business entirely, even as standard smartphone prices increase. 

Fragmentation will be next

Those outcomes won’t be universal, as the desire for sovereign data services and growing mistrust of US tech companies suggest OpenAI’s products might see limited adoption in most markets. But they could serve to accelerate divergence in smartphone purchasing patterns worldwide, while adding to market pressure.

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Meta pulled a new AI feature on Instagram just days after its launch because of criticism about how the tool handled publicly posted photos.

The feature was part of the new AI image generator, Muse Image, and allowed AI-generated images to be created using content from public Instagram accounts. By specifying a public account with an @mention, users could let the AI ​​model use the person’s images as a reference without informing the account holder.

The launch quickly prompted concerns about privacy and the risk of abuse, with critics saying the feature could be used to create manipulated or offensive images based on other people’s public content.

Meta said its the goal was to give users a creative tool where they could decide for themselves whether their public content could be used. But it removed the feature after feedback that the feature did not meet expectations.

Apple surprised the tech industry after financial markets closed Friday with news the company has sued OpenAI, alleging theft of trade secrets for ChatGPT hardware. The lawsuit particularly targets some senior ex-Apple employees now working at OpenAI.

Apple’s suit names two former employees — Chang Liu and Tang Tan, former vice president for product design, iPhone and Apple Watch — as well as OpenAI and that company’s recently-acquired firm, io Products, alleging “trade secret misappropriation and breach of contract.” 

Jony Ive, who sold io Products to OpenAI, is not named in the lawsuit, though it seems relevant that Tan was one of the senior ex-Apple executives who founded that company.

For its part, OpenAI issued a brief statement in response to the litigation. “We have no interest in other companies’ trade secrets,” the company said. “We remain focused on building innovative technology that empowers people everywhere.”

The allegations against Tan

Some of the claims and allegations included in Apple’s lawsuit include:

• That in the months before leaving Apple, Tan met with OpenAI or its collaborators and discussed meetings with a key Apple supplier.
• He emailed himself information about suppliers and internal summaries.
• When interviewing former Apple staffers for jobs, he used confidential information, such as internal project code names, to gain even more knowledge.
• He asked candidates to bring actual parts from Apple to interviews to discuss — and a then-Apple employee screenshotted and downloaded files concerning a highly confidential Apple project before attending an OpenAI recruitment session.
• Tan asked Apple employees to bring CAD/design artifacts to their interviews.
• Tan allegedly instructed new hires on how to avoid scrutiny when leaving Apple, such as instructing them not to tell the company they had taken jobs at OpenAI.

The ‘so funny’ laptop bug

The lawsuit also claimed that after quitting Apple for OpenAI in January 2026, Chang Liu managed to keep or “otherwise acquire” an Apple-issued notebook which he used to access confidential data on the company’s private network while at OpenAI. “LOL, I found out I can access the [server], so funny,” Liu texted a friend still working at Apple.

The suit alleges that he made no effort to report the situation, which was a bug in the system he had uncovered. Apple eventually discovered the exfiltration was taking place and took steps to prevent it, but Liu allegedly downloaded more than 1,000 pages of data, including “confidential technical presentations, spreadsheets, PDFs, and written work product,” Apple said.

“Only OpenAI and Mr. Liu know all the ways they have been exploiting the trove of Apple confidential information he stole, and to the extent they have not concealed or destroyed the evidence of these misappropriations, it will be investigated thoroughly in discovery.” 

Apple’s lawsuit also alleges Liu was simultaneously coaching a current Apple employee named Alyssa Peng on how to copy files from Apple workstations without triggering the security team, asking her to get specific confidential information and using Apple’s stolen data to help her get ready for an eventual OpenAI interview.

Why this could get bigger

There’s much in the litigation that it will garner serious international attention as it unfolds. Apple’s argues that a competitor with access to so much of its own proprietary information could “bypass years of independent research and development, skip the capital expenditure required to build genuine expertise, and bring products to market faster and at lower cost, harming the value of Apple’s investments.”

It’s not just the secrets behind actively-used processes Apple is protecting; the company is also asserting its rights to regain control of information it has assembled over time concerning processes and manufacturing attempts that have failed. That’s understandable – you can invest a lot of money in finding out what doesn’t work and knowing that is a trade secret in itself. 

“OpenAI coaches candidates to prepare for their interviews by studying Apple’s confidential engineering documentation, internal presentations, and proprietary technical materials,” the litigation claims. “OpenAI then uses its insider Apple information to ask detailed questions to extract more: about Apple’s proprietary tools, vendor management processes, engineering methodologies, manufacturing workflows, and supplier relationships, for example.

“OpenAI has turned to trade secret misappropriation to free-ride off Apple’s decades of innovation,” Apple said. “This is the tip of the iceberg.” 

The lawsuit also confirms that Apple often designs and customizes the specialized machinery used in its suppliers’ factories, and that trade secrets concerning those efforts have been grabbed. The suit notes that OpenAI works with established Apple suppliers Foxconn, Luxshare, and Goertek on its own hardware.

If true, these allegations go right to the top of OpenAI’s hardware development plans. Tan is now OpenAI’s Chief Hardware Officer.

The lawsuit points out that OpenAI now employs more than 400 Apple engineers and executives (including the company’s former Vision Pro Vice President), suggesting its entire approach to hardware recruitment is based on extracting Apple’s proprietary knowledge from potential hires. 

“Apple lacks visibility into what’s been happening behind closed doors at OpenAI, where such misconduct is normalized and exemplified by leadership,” the lawsuit argues. “This much is clear, however: at every level, from members of its Technical Staff to its Chief Hardware Officer, and in coordination with business partners, OpenAI has been stealing Apple’s trade secrets and confidential information. As a natural result, OpenAI’s nascent hardware business now rests on the shakiest of foundations, rotten to its core by its illegal reliance on misappropriated trade secrets.”

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Consumer electronics prices are shooting up. Energy prices are increasing fast. Even water bills are climbing. For a technology that promises “efficiency,” the ongoing AI gold rush seems to be taking things away, much like the proverbial gift that keeps on grabbing.

With hundreds of billions in AI investment already racked up for 2026, it’s important to remember the entire industry is currently built on a mountain of debt — and much of this borrowed money is being spent on data center capacity. That’s true, even though consumers would probably rather have a cheap Mac than spend money on an AI subscription service. 

All this debt is being amassed because a small number of people at a very small number of firms have decided to make huge investments in the tech, which at present requires huge quantities of energy, memory and data center capacity to run. 

But it won’t always be this way.

A mountain of debt, but we’re short of memory

Look, the industry as it is now just doesn’t seem sustainable. Trillions are being spent and memory vendors are shifting capacity to make the high-value, high-bandwidth memory these server farms require — at the expense of traditional consumer electronic suppliers. 

The rapid rollout just creates AI tech will need to be replaced, likely at greater cost, in a few years’ time. In a nutshell, the industry is spending trillions to make billions; Sequoia’s David Cahn estimates the AI revenue gap between infrastructure expenditure and the revenue to justify it has already fallen $600 billion a year short. 

At some point, the VC money will run dry, after which it is inevitable deployment will slow and demand for all the components — including memory used in these large language model (LLM) data centers will fall. Some analysts think capex growth in the sector could halt by mid-2027.

At that point, memory vendors will have expensive production facilities and extensive defaults on their order books. If the 2027 prediction is true, those vendors will feel this impact in the form of reduced forward orders by the end of 2026.

The problem is that the investments have become so vast that any slowdown will have consequential effects across all sections of the economy. 

After the gold rush

Almost certainly, the technology will continue to improve, and the problems we’re looking to solve today might no longer be challenges once fresh innovation strikes. So, what happens next? 

Let’s think about memory, the biggest pain point at the moment and where we will (hopefully) find future innovation. At present, some of the largest LLMs sit inside data centers supported by vast quantities of memory. These machines are built to handle really complex tasks, but most of the time are used to search the web, deliver writing assistance and summarize documents. Those frequently-transacted tasks barely stretch the capabilities of these services and Apple, and others have already figured out how to run such tasks on device.

That’s the first obvious space in which to innovate – to invest in 1-bit data LLM systems to miniaturize and distill models so they actually run on the device you’re using, rather than relying on all those remote servers. 

The Apple shopping list

Apple’s interest in 1-bit data LLM pioneer PrismML speaks volumes about where the iPhone maker sees LLM development going, as did its acquisitions of Kuzu Inc., WhyLabs Inc, Pointable Inc., and Datakalab Inc. in recent years. 

The beauty of PrismML’s tech is what it can do. It was recently used to compress Alibaba’s huge 27-billion-parameter Qwen 3.6 model from 54GB down to under 4GB, running with all 27 billion parameters active simultaneously — all without sacrificing benchmark performance. 

The kicker? It managed to run that advanced, sophisticated AI model on an iPhone 17 Pro. My take? Just as music used to be captured on reel-to-reel tape and is now digitized and in the air, AI will move from the data center to the device, possibly faster than people expect. 

Apple has three pillars for AI: On-device for most of what you need, on Private Cloud Compute servers for most of the rest, or via third-party server-based systems for the most demanding tasks. That’s a blueprint for how the industry will evolve as technologies represented by PrismML tend toward bringing more of that intelligence to the device. Over time, those local tasks will become more sophisticated, eroding the available market for today’s heavily-indebted AI incumbents. 

Emerging priorities such as the need for privacy, data sovereignty, and trusted cloud will also spur the emergence of a multipolar AI future in which no one vendor dominates, further complicating their journey to profitability. It’s a model that favors the kind of service-agnostic, edgeAI approach Apple has taken.

EdgeAI for the rest of us

In the end, I don’t think there will be a need for much of the AI data center capacity now being built, because Apple and others will figure out how to use data minimization to transact sophisticated AI tasks on the device. For the most part, EdgeAI will deliver the consumer AI experience, while data centers cater to more sophisticated use. One day, after this gold rush has run its course, we’ll peer outside of our basements to see which of today’s AI firms actually are the chosen ones.

They may not be the ones you expect.

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The AI IPO tsunami on the stock market has only recently gotten under way, with SpaceX’s more-than-$2 trillion IPO likely to be followed in several months by OpenAI’s and Anthropic’s IPOs — each of which is likely to hit $1 trillion.

That will mint three new trillion-dollar AI companies in a matter of months, all of which compete with Microsoft. 

Wall Street has never seen anything like it. Previously, the most money raised by all IPOs in a single year was $671 billion in 2021. It took 38,644 deals to get to that figure. Compare that to three deals this year that by themselves will likely total $4 trillion.

The numbers are eye-popping. 

For Microsoft though, it’s not the numbers themselves that are important. It’s what will happen to the company once it as three newly minted trillion-dollar AI competitors. Until recently, when it came to AI, Microsoft was king of the hill. But can it keep that place?

Microsoft’s weakened position

The IPOs come at a particularly fraught time for Microsoft. At one point, it was the most valuable AI company in the world, with a big head start on the tech industry.

No longer. Microsoft’s stock price has tanked in the past 12 months, even as the S&P index has soared. In the last year, Microsoft’s stock price has dropped 24%, while the S&P has jumped 24%. The two were pretty much in sync until last fall..

Microsoft has fared even worse against its most powerful AI competitor, Google. In June 2025, Google’s total value was $2.1 trillion, well behind Microsoft’s  $3.57 trillion. By  mid-June this year Google was worth $4.5 trillion, Microsoft, $2.8 trillion. That’s entirely due to Google’s AI push and Microsoft’s failure to improve Copilot significantly.

Matt Vellosso, who worked for Microsoft for 14 years — including four as technical advisor to CEO Satya Nadella and then as Partner Director for fostering AI innovation in Windows before leaving in 2023 — is scathing about what he views as Microsoft’s AI failures. 

He warned: “Microsoft missed the internet wave, the mobile wave and now it missed the AI wave.”

Show me the money

The most immediate likely impact on Microsoft after the three massive IPOs take place will be on the company’s stock price, which could well take another hit. Investors don’t want to miss out on the AI boom, and until now, there’s been a relatively small number of companies in which they could. When Anthropic and OpenAI join SpaceX as publicly traded companies, investors will have three more choices than they did only a few months ago. That could make it tougher for Microsoft to attract AI-focused investors. And that, in turn, could knock down its stock price. 

A lower stock price means the company will have a harder time raising money when it needs it. In addition, Microsoft won’t be able to as easily buy other companies in stock-only deals, because the value of its stock will be less.

Still, the IPOs are not all bad news for Microsoft’s stock position. It does, after all, own 27% of OpenAI. So if OpenAI is valued at $1 trillion after its IPO, Microsoft has a $270 billion stake in it.

Thumbs up for increased Azure revenue

One area where these mega IPOs should be unalloyed good news for Microsoft is in Azure revenue, which should significantly. Microsoft’s final divorce settlement with OpenAI requires the latter to buy $250 billion in Azure services through 2030. And its  estimated trillion-dollar valuation ensures the company will be around for the long term, meaning Microsoft can count on that revenue — and possibly more on an ongoing basis.

Microsoft will likely also get tens of billions of dollars from Anthropic for Azure cloud services. Anthropic might spend $43 billion annually on Azure cloud services by 2030, according to estimates by HSBC, one of the world’s largest banking and financial services companies.

Thumbs down for the effect on Copilot

Although Azure use will boom thanks to the IPOs, Microsoft’s own Copilot could face significant competition at a time when it’s having serious problems gaining traction. In its April 2026 earnings call, the company said Microsoft 365 Copilot had 20 million paid seats. That’s up from 15 million paid seats as of January, but still a minuscule number, considering Microsoft has 450 million Microsoft 365 commercial subscribers. That means only about 4% of the company’s business customers have been willing to pay for it since its launch in late 2023.

Beyond that, developers have been leaving GitHub Copilot and turning to Anthropic’s Claude Code and SpaceX’s recently purchased Cursor. A survey by the software development company JetBrains of more than 10,000 developers found that 29% used GitHub Copilot, 18% used Cursor and 18% used Claude Code. 

Early in 2025, GitHub Copilot had a commanding 67% market share.

More downside than up from the IPOs

Although the IPOs do have some upside for Microsoft — dramatically increased Azure revenue and several hundred billion dollars in OpenAI stock holdings — mostly, they’re bad news thanks to increased competition. 

Unless Microsoft significantly improves Copilot for businesses, developers and consumers, the company’s one-time AI dominance will erode even further.

Forty million UK iCloud users could be owed up to $100 (£77) each after a $3.9 billion (£3 billion) class action lawsuit against Apple was cleared for trial — and the company’s problems may be just getting started. 

For Apple, the worry is that this case could snowball to become yet another existential regulatory problem. The action was brought by consumer group Which?, which accused Apple of breaching UK competition law by giving its iCloud storage service preferential treatment and “trapping” customers with Apple devices into using iCloud. 

Trapping happy customers

Apple achieves this by encouraging its customers to sign up to iCloud for storage of photos, videos and other data while also making it difficult for them to use alternative providers to backup key data. The company also squeezes extra dollars out of customers by providing a stingy 5GB of storage for free, while putting important data including messages and photos inside that allocation. Even Google provides 15GB of storage in its free tier.

The problem is that the scale of Apple makes it difficult for competitors to reach customers with alternative solutions, while Apple’s control over the operating system gives it integration advantages third-party competitors don’t get. 

While there may well be justifications for constraining access to some personal data, those privacy and security challenges don’t apply to all of it. 

You are the product

When it originally filed the claim, Which? explained that Apple could resolve the claim without litigation by offering consumers their money back and opening up iOS to allow users a real choice for cloud services. This is unlikely to happen.

This case has been slowly making its way through the Competition Appeal Tribunal, which last week finally gave permission for the case to go to trial.

Apple won’t be looking at a hefty fine just yet. The first available trial date is in October 2028 and the legal fight is expected to last nine weeks, which might, or might not, equate to a Christmas surprise for Apple’s then CEO. There’s no time to sit back, however, as the company must still file its defense papers with the court by the end of next month, July 31.

The snowball factor

The UK is not alone. Italy has launched its own antitrust probe into Apple’s iCloud dominance under the EU’s Digital Markets Act (DMA). The problem with that litigation is that since Italy has commenced the probe, other nations across the bloc might also act.

Italy is looking to see whether Apple has failed to open up its iOS and iPadOS ecosystems to rival cloud services, arguing that third-party providers are unable to access the same system components as iCloud. The DMA insists competitors should enjoy the same degree of access as iCloud because Apple is seen as a gatekeeper, which means it is required to meet a higher set of standards.

Apple, of course, will inevitably — and rightly — argue that customer privacy needs to be protected, and that open, free, access to some of the data its trusted iCloud service can use is not in the consumer interest. 

The company has already proposed one way in which it can provide third-party services with access to confidential data with a trusted intermediary system that anonymizes that information in use. 

Why we need a Trusted System Agent model

That’s precisely what it offered Europe when it proposed a solution called Trusted System Agent — an intermediary that would allow virtual assistants to safely access the same features and capabilities as Siri AI for devices in the EU. Unfortunately, EU regulators didn’t accept Apple’s justification concerning the need to protect customer privacy, which is why Apple Intelligence won’t be available in Europe for a while, if at all.

In the event Apple’s iCloud service falls short of the Italian probe and therefore the DMA, the danger is that if EU regulators take the same evangelically hard-line stance with iCloud services as they have done so far with AI, customers might find themselves losing access to the service. 

First blood

That’s in Europe, of course. But the UK case is likely to get to court long before litigation processes in Europe get going, making the UK action an important test case in which yet another important component of Apple’s offering to consumers is up for trial.

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Not-yet-profitable AI companies are constructing a vast and expensive global network of server farms to support cloud-based generative AI (genAI) services. Deeply financed by venture capitalists who will one day want to see return on their investments, these centers are consuming enough memory to drive consumer technology prices higher and higher.

Yet, for all the investment now going on, it’s inevitable that new on-device genAI models will emerge. When they do, the AI tasks for which you use cloud services today will be handled on device tomorrow. And at the speed we’re going, tomorrow is not very far away.

We already know it is possible. Just look at Siri AI. To create it, Apple worked with Google Gemini — using the latter to help build and distill Apple’s own AI models, many of which now work entirely on device.

The hidden cost of the AI buildout

This move toward edge AI takes place as the tech industry pours its eggs into the AI basket, with major memory suppliers redirecting manufacturing capacity toward higher-value memory products for AI servers, such as advanced-layer 3D NAND. They’ve done so while failing to invest in additional capacity, prompting a shortage of the kind of general purpose RAM you use in your computer, console, or smartphone.

This is having a dramatic impact. Gartner says the memory shortage will cause PC shipments to drop 10.4% in 2026 and smartphone shipments to decline 8.4%, with prices on those products rising 17% and 13%, respectively, versus 2025 levels.

The AI consumer tech tax

This leaves electronics manufacturers quarrelling over the remaining supply, while shrinking profit margins force them to increase prices. Sony has already raised the PS5 price by $100, Microsoft has raised Xbox prices, and Nintendo has raised the price of its first-generation Switch. Samsung has quietly increased prices across Galaxy smartphones, tablets, and laptops. Analysts also warn that “shrinkflation” is escaping from the supermarket and coming to your tech, an insidious move in which manufacturers quietly reduce the features/performance of their devices to maintain familiar price points. That laptop you purchase could ship with a downgraded display, for example.

Apple is not immune. The iPhone 18 Pro is tipped for a significant price increase in 2026, potentially adding $100 to $150, even before tariffs are considered. Apple CEO Tim Cook recently warned of price increases ahead as a direct impact of demand for memory components.

A business model under pressure

Surely all this investment in AI servers and the increased cost of tech products will be worth it in the end, right? Writer and tech critic Ed Zitron disagrees, pointing out that for $200 a month, a user can burn $8,000 in Anthropic tokens or $14,000 in OpenAI tokens. 

He argues that subsidy at this scale suggests AI economics are already broken, and that the actual value of AI may be inflated, forming a big bad bubble ready to burst once market opinion (and investment) catches on.

By spending billions chasing market share, AI has fundamentally undermined its own value, making it harder to achieve sustainable business success. Costs might well fall in future, of course, but edge AI could be the biggest cost reduction exercise of all.

Make tokens pay

Perhaps AI companies have finally begun turning things around? Maybe not. Less than three months into paying the actual costs of LLM-based services, both OpenAI and Anthropic are considering drastic price cuts, with one Cisco executive stating publicly that AI token costs are far higher than the actual value those tokens are generating at scale.

Even Meta has imposed strict limits on token usage after finding it was on track to spend billions on internal AI alone in 2026. The Times reports that two large banks spent an astonishing $1 billion on AI experiments without seeing any significant return.

That’s the use value, but what about the hardware investment? It is really hard to ignore the irony that billions of dollars are being poured into a server-based infrastructure that might become obsolete before turning any kind of profit. Today’s H200-based servers will need to be upgraded sooner or later, and when they are, where will the money come from? 

Apple has a different approach

Consumer electronics leader Apple clearly sees this. While it has been accused of being behind in AI, perhaps it was just being realistic. After all, the reality seems to be that we’re experiencing something akin to venture capital backed economic socialism in the AI sector, with billions invested for no visible — or, if Zitron is right — possible return. 

At the same time, Apple seems focused on building edge AI as a privacy-preserving, cost-saving alternative to the massive data center buildouts rivals have pursued. 

Rather than squandering billions on a revenue-draining chatbot, Apple worked with others to create its own alternative. As part of its agreement with Google, Apple is using a large version of Gemini to train a smaller, distilled version capable of running locally on Apple hardware.  Siri AI can hold conversations, pull context from a user’s emails, messages, and photos, answer live questions from the web, and act across apps, with much of the work taking place on the device itself.  

These tools are also available to app developers, thanks to Apple’s Foundation Models framework. At WWDC, Apple showed how its devices can work together to run local LLMs using MLX Distributed, which means users can run on-premises, highly private AI models. And the company continues to make strategic acquisitions, such as the recent purchase of on-device AI startup Liquid AI.

On-device or off, the move has caused Apple to break with years of tradition to pack its systems with more and more memory, ironically feeding the same component pricing narrative.

The squeeze isn’t over

Who pays for all this? You do. Memory prices will continue to rise across the year, with TrendForce predicting up to 75% increases on top of the already 100% spike we’ve seen in recent months. Memory suppliers seem unwilling to ramp up supply to help bring costs down, potentially because they don’t want to be left with unused capacity once the AI bubble does burst. That means existing manufacturing is being pointed at the highest value memory components, further feeding price hikes.

When AI leaves the cloud

What happens to investors when AI stops needing a data center to be useful?  The companies that survive this shift won’t necessarily be the ones who built the biggest and most costly clouds. They are more likely to be the ones who identified cloud-based AI as the start of a transition toward more intelligent devices equipped with their own on-device AI. That is precisely what Apple is building toward.

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Apple execs are now acknowledging the company is going to need to raises prices to cope with higher component costs, particularly memory. Apple has been battling to avoid doing so, but warned this week that those efforts are “unsustainable.”

The price pressure is being felt across the tech industry. Omdia predicts the average selling price (ASP) of smartphones globally will increase by around 20% this year — partly because AI industry demands have pushed up RAM prices and partly because of rapid cost increases in processor production as a direct consequence of war in the Middle East. This impacts anything that uses memory or processors.

Apple must raise prices, CEO warns

“We’re doing our best to mitigate the huge increases that are being passed to us, and we’ve been trying to shield our customers from the increases, but the situation has become unsustainable,” current Apple CEO Tim Cook told the Wall Street Journal.

OK, so prices are going to go up. But how?

If Apple must raise prices, the way it does so matters. Will it increase prices across the board, or choose a subtle, strategic approach that protects margins while also maintaining rapidly accelerating market share growth?

Until now, Apple has been benefiting from the rising tide in memory prices. While competitors have been steadily increasing prices across the board, Apple introduced its first $599 laptop even as it eats into mid-range smartphone sales. 

To grow, or to grow less?

The PC industry is not growing (outside of Cupertino), and Apple and its investors already know that the inordinately high customer satisfaction ratings its platforms enjoy mean that when people switch to them they tend to stick around. That’s why it matters that Cook highlighted record switchers and first-time platform users during the company’s most recent fiscal call. Apple is growing new customers, people who are likely to sign-up for services, accessories, and future upgrades. Winning the customer is an investment in future performance.

When it comes to increasing prices, we’ve seen some gentle experimentation in the Mac mini line, where the entry-level $599 model was effectively replaced by a more expensive $799 SKU. There have been suggestions Apple could do the same with the $599 MacBook Neo, dumping the entry-level build in favor of the (better) $699 model. I’m not certain that’s the best approach. 

A matter of choice

I’d argue that the $599 price point is psychologically the best bit of marketing Apple has ever done as it draws new users to look at its platforms. I also think substantial numbers of people already shift up to the $699 version, if they can, making that entry-level price an incredibly effective marketing tool with which to woo customers. It looks like that approach is working; the MacBook Neo has led the Amazon Laptop Sales chart ever since it was introduced and is selling in huge quantities globally.

Francisco Jeronimo, IDC vice president for data and analytics, sees this, writing: “It will be interesting to see whether Apple raises prices across its entire portfolio or plays strategically by subsidizing its more affordable products to gain market share and grow its installed base.”

If Apple raises prices at the price sensitive, entry-level end of its market, it runs the risk of slowing its own resurgence. Given that a 10% price hike here is only worth around $60, the revenue generated might not justify blunting Apple’s offer to new users.

Pricing and strategy

But Apple isn’t defined by its entry-level markets. Its biggest earning opportunities continue to be generated by the aspirational middle class, who, while feeling the pinch of declining living standards in many markets, can still handle the price of a top-of-the-range iPhone Pro. A 10% price increase at that end of the market will generate a much more significant chunk of revenue – and since rival vendors are raising their prices at this end of the market, Apple can follow suit while still seeming affordable. It’s an approach that maintains growth while optimizing margins.

Apple generates roughly half its revenue from iPhone sales, with the Pro and Pro Max devices accounting for a significant chunk of that money. Consumers looking to buy one of Apple’s high-end devices are likely to be less price-sensitive than those making purchases at the low- and mid-points of the company’s market range. 

With that in mind, it makes more sense for the company to raise prices at the top, while working to maintain the cost of entry at the lower end. It could, of course, raise prices universally, but doing so makes less sense.

What next?

Whatever strategy Apple adopts, company leadership is clear that component pricing is hitting hard. “We definitely need memory pricing and supply to return to reasonable levels for consumer products. That’s the bottom line,” Cook said.

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A federal judge has rebuffed Workday’s claim that it cannot be held liable under California anti-discrimination laws when its tools are used to screen (and potentially reject) job candidates in other states.

This week, US District Judge Rita Lin indicated that she will likely allow additional state discrimination claims against Workday to move forward. This would significantly expand the closely-watched case and likely ratchet up scrutiny of AI recruiting tools and their potentially inherent biases when it comes to age, race, sex, disabilities, and other factors.

Further, it could indicate that, even if a company is not the final employer, it may be held liable if its tools materially influence who gets rejected. This could set new legal standards for AI hiring systems, and have implications across industries, experts note.

“This case reinforces the importance of actually managing AI risks,” said Valence Howden, advisory fellow at Info-Tech Research Group. “If an AI-enabled model or ATS [Applicant Tracking System] is making decisions based on historical information, it can raise questions about whether bias in outcomes and datasets has been properly addressed.”

The case so far

Mobley v. Workday, Inc. alleges that Workday’s AI screening tools discriminate against job seekers based on age, race, and disability. The suit was filed in 2024 in the US District Court of California by Derek Mobley, a Black disabled man over 40, who claimed Workday’s algorithms continually screened him out as he applied for more than 100 positions on the platform.

The claims alleged discrimination prohibited by several US and California statutes: Race and sex under the Civil Rights Act of 1964 (Title VII); disability under the Americans with Disabilities Act of 1990 (ADA); age under the Age Discrimination in Employment Act of 1967 (ADEA); and race, gender, and age under California Fair Employment and Housing Act (FEHA).

Specifically, the suit centered around Workday’s use of automated, algorithm-driven tools for applicant screening. It alleged that these systems rely on historical data and statistical modeling that can make them susceptible to existing biases, even if protected characteristics like race, age, sex, or disability are not explicitly provided.

Bias may enter these systems in different ways, the plaintiffs argued, including via training data, model design, and evaluation criteria for candidate fit. The system could reproduce discriminatory outcomes by making correlations from data. For instance, years of experience on a resumé may indicate age; long employment gaps may infer a disability or caregiving responsibilities; educational and institutional affiliations could reflect race.

Workday has argued that it is not subject to liability under employment statutes because it does not qualify as the job applicants’ “employer.” But federal judges have allowed key parts of the lawsuit to move forward, ruling that Workday could potentially be treated as an employer’s “agent” for the purposes of anti-discrimination law.

The latest dispute centers on FEHA. According to legal sources, the California statute is among the strongest anti-discrimination laws in the US, in many cases providing broader protections than federal employment laws.

Workday asked the court to dismiss claims brought under California law, saying FEHA should not apply to the hiring decisions of out-of-state employers and applicants. The company’s lawyers argued that enforcing this would effectively allow California law to supersede that of other states, just because a company used their platform.

But Lin disagreed, saying FEHA does apply, and in fact, Workday is directly liable for its “own engagement in FEHA-regulated activities on the employer’s behalf.” Holding businesses liable for “their own discriminatory conduct” is within the scope and purposes of FEHA and consistent with public policy.

However, the issue is still to be decided; Lin did not indicate when she would release a final ruling.

Workday’s defense

A Workday spokesperson called the claims in the suit “false.”

“Workday’s AI recruiting tools don’t make hiring decisions and are designed with human oversight at their core,” the spokesperson told CIO. “Our technology looks only at job qualifications, not protected traits like race, age, or disability. We rigorously test our products as part of our responsible AI program to confirm our tools do not harm protected groups.”

Workday’s platform is meant to provide insights on how well a candidate’s qualifications match the requirements of a posted job, the company said. Those tools focus only on qualifications listed in a candidate’s application, which are compared to qualifications identified by the employer as important for the job.

Workday’s Chief Responsible AI Officer Kelly Trindel said its AI does not make employment decisions, automatically reject candidates, or determine who gets a job; further, she said, there is no evidence that the company’s tools result in harm to protected groups.

Trindel, who is former chief analyst of the Equal Employment Opportunity Commission (EEOC), leads a dedicated team composed of psychologists and PhD-level data scientists whose sole focus is to ensure that its AI is “responsible, fair, and ethical.” She said that the company’s AI systems undergo ongoing reviews throughout their lifecycle to help prevent unintended consequences, and Workday is “committed to accountability, transparency, and trust,” and invests “significant resources” into identifying and mitigating bias.

Further, she said, Workday has a company-wide commitment to ethical AI, and an independently-evaluated AI governance program based on standards from the National Institute of Standards and Technology (NIST) and the International Standards Organization (ISO).

“Workday builds AI to support people, not replace them, and this is of particular importance when it comes to hiring,” Trindel noted. Its platform is designed to help employers “manage high-volume processes more efficiently, surface relevant information, and reduce administrative work so teams can spend more time applying their expertise and judgement to hiring decisions.”

What this means for enterprise leaders

Workday isn’t alone in its legal challenges; other AI hiring tools are also being scrutinized over their methodologies, algorithms, and data-collecting practices. Eightfold, for one, is also facing a California class action lawsuit alleging that its tools unfairly rely on job candidates’ online data to predict whether they’d be a good fit for a position.

This means that enterprises, who are already feeling increased pressure to document hiring decisions, conduct AI bias audits, and maintain human oversight in recruitment and hiring, must be even more diligent in their vetting of AI tools.

Organizations must be actively defining how these recruitment tools should work, identifying bias in their algorithms, and setting up structures to test for bias across the tools’ decision-making logic, Info-Tech’s Howden advised.

“Validation of non-biased outcomes also needs to be active and ongoing, rather than a point-in-time exercise,” he said.

While Workday and others say human oversight is paramount, “it’s hard to incorporate humans into the process if the platform does the weeding out before humans have the ability to intervene,” Howden pointed out.

Discriminatory biases can exist in past hiring decisions, so it’s easy to forget that AI can “emulate and adapt those biases as part of its perspective,” he said. That includes how AI looks at language: Different cultures use different phrasing, and AI can capture that and use it to exclude candidates.

Ultimately, he called the case a “cautionary tale” illustrating how lightly some organizations have been treating AI risk. It also highlights the urgency involved in building out more advanced enterprise risk practices, “rather than relying on the limited capabilities they may have employed up until now.”

This article originally appeared on CIO.com.

Adobe’s Firefly Graph is now available to Creative Cloud customers, offering a node-based workflow tool designed to help business create content at scale with generative AI (genAI). 

With Firefly Graph, users can connect multiple tools in visual workflow, with each “node” performing a specific task before passing its output to the next node. This gives creative professionals more control over generated outputs, according to Adobe, and makes it easier to try out ideas by swapping, adjusting or adding components.

For example, a user could start with a text prompt box that connects to a node that generates an image using an AI model from Adobe or third-parties such as Google and OpenAI. Further along the chain, the user could add nodes to remove a background or upscale an image, for instance, before producing an image, video or other asset ready for use.

Changing one aspect, such as adding a reference image or adapting the text prompt, would change the final output.

It’s an approach similar to node-based workflow tools such as ComfyUI — a startup valued at $500 million which claims more than 4 million users. Others include Weavy, acquired by Figma last year for a reported $200 million. 

With so many AI tools available to creative professionals, workflows can get complex and hard to replicate, said Elliot Sedegah, director for strategy and product marketing at Adobe. Firefly Graph provides access to more than 300 different node types, including images, video editing and AI generation tools across Adobe’s portfolio and third-party tools. 

“Whether you’re working at a mom-and-pop shop or a larger enterprise, you’re looking for consistency and then bringing that into a workflow so that you’re not hopping in and out of different tools,” he said. “Putting all that together takes massive amount of time, and sometimes it’s very difficult to even know what you did.”

Once created, workflows can be shared across an organization as repeatable processes for other individuals or teams to use. “Think of that rock star creative that you have and the recipes they create: those are now canonized as workflows, as assets, that the rest of the organization can take and reuse over and over again,” said Sedegah.

In addition, while creative professionals are needed to created high quality assets, reusable workflows can be put into the hands of broader teams to create content for large audiences, said Sedegah.

Firefly Graph addresses a challenge that most large creative organizations face, said Lisa Gately, principal analyst at Forrester — namely that their best creative workflows “live inside the heads of a few experts.

“Teams can generate images and video with AI, but reproducing the exact sequences of creative decisions, model selections, edits, and refinements that lead to a high-quality result is difficult and inconsistent. Firefly Graph turns those workflows into reusable assets,” she said.

While other node-based workflows aim to address similar problems, Adobe’s pitch is that Firefly Graph provides customers with the benefit of integration into its product suite. 

“Firefly is a full, broader AI creative studio, not just a node-based tool, so [Firefly Graph] is a part of a bigger picture,” said Sedegah. “The strength is having everything in one place with the tools that people know.” 

“Where Adobe differentiates is in enterprise integration,” said Gately, with Adobe connecting Firefly Graph to a range of other Adobe tools. Those include Creative Cloud applications; Firefly Boards for ideation; and Firefly Creative Production. 

“The workflow becomes part of a broader content supply chain instead of a standalone creation tool,” she said. ”Organizations committed to other tools are unlikely to migrate for a node-based canvas — making a change is about the broader content supply chain.”

Firefly Graph is available now to Adobe Creative Cloud for Enterprise subscribers. Creative Cloud for Enterprise is licensed by seat, requiring custom, volume-based enterprise agreements. Creative Cloud for Enterprise customers receive credits for Firefly Graph. Creative Cloud for teams customers can sign up for a public beta online. Creative Cloud pricing starts at $99.99 per license each month.

This article was updated on June 19 with pricing information from Adobe.