$Apple (AAPL.US)$ has reportedly closed in on a deal with ChatGPT-parent OpenAI to incorporate the startup's technology into iPhones, as part of a broader strategy to introduce artificial intelligence features to its devices.

What Happened: Apple is finalizing an agreement with $Microsoft (MSFT.US)$-backed OpenAI to use ChatGPT features in iOS 18, the upcoming iPhone operating system, reported Bloomberg, citing people familiar with the matter.

Apple is also engaged in discussions with $Alphabet-A (GOOGL.US)$'s Google to potentially license Gemini.

While no agreement has been reached yet, the negotiations are still ongoing.

The potential deal with Sam Altman-led company would allow Apple to offer a popular chatbot as part of a series of new AI features, which the company plans to unveil at its annual Worldwide Developers Conference in June.

Last year, Apple CEO Tim Cook admitted to personally using OpenAI's ChatGPT. However, he also noted that there were "a number of issues that need to be sorted."

Why It Matters: Cook has been vocal about the company's AI efforts, expressing confidence in its AI prospects despite concerns from investors. He also revealed that Apple has invested $100 billion in research and development over the past five years, as part of its plan to unveil new AI features at WWDC next month.

Apple's push into the AI space also includes the development of its own AI chips for data centers, a move that could potentially disrupt the market. The project, codenamed ACDC, is an extension of Apple's existing in-house chip efforts for its devices.

Disclaimer: This content was partially produced with the help of Benzinga Neuro and was reviewed and published by Benzinga editors.