Apple CEO Tim Cook has expressed admiration for DeepSeek's AI models, calling them "innovation that drives efficiency" during an earnings call on Thursday. This praise comes despite controversy surrounding the Chinese AI lab, including allegations of intellectual property theft and questions about the efficiency of its models.

Cook's comments were in response to an analyst's question about how DeepSeek's AI models would impact Apple's margins. The CEO noted that Apple leverages a hybrid model for its AI, running simple tasks locally on its custom silicon chips and more complicated tasks in the cloud through partnerships with AI model providers. This approach allows Apple to balance efficiency with innovation, according to Cook.

Currently, Apple has only one AI partnership, with OpenAI, which enables ChatGPT to answer complex questions from iPhone users in a private cloud. However, OpenAI has claimed that its AI models were used to train DeepSeek's AI models through a process called distillation, violating OpenAI's usage policies. This development has cast a shadow over DeepSeek's accomplishments.

Despite this controversy, Cook's praise for DeepSeek's AI models suggests that Apple is open to exploring other AI partnerships in the future. The company has indicated that its OpenAI partnership is not exclusive, and it may integrate other companies' AI models, such as Google's Gemini or Anthropic's Claude, into the iPhone.

However, tech analysts have raised doubts about the efficiency of DeepSeek's AI models, suggesting that they were trained with significantly more GPUs and computation costs than the company claims. This would undermine DeepSeek's accomplishments and impact its competitive pricing strategy.

In addition to discussing Apple's AI ambitions, Cook also addressed the success of Apple Intelligence, the company's AI feature. Despite a phased launch, iPhone sales slightly declined in the last quarter compared to last year. Cook attributed this decline to regions where Apple Intelligence had not yet rolled out, claiming that sales were stronger in regions where the feature was available.

Apple has faced other issues with its AI features, including the recent pause of its AI summaries of news articles after the feature produced misleading headlines. In one instance, Apple Intelligence hallucinated and changed a BBC news headline to incorrectly read that Luigi Mangione, the man charged in the murder of UnitedHealthcare CEO Brian Thompson, had shot himself, which was untrue.

As Apple continues to develop its AI capabilities, the company's approach to innovation and efficiency will be closely watched by investors and the tech industry. While Cook's praise for DeepSeek's AI models may signal a willingness to explore new partnerships, it remains to be seen how Apple will address the challenges and controversies surrounding its AI ambitions.