Though the A11 Bionic processor powering the iPhone X and 8/8-Plus grabbed fewer headlines than some of the other features and innovations Apple Inc.  (AAPL) unveiled for its latest smartphones, its imprints can be found on quite a lot of what was announced. And when one looks at its total impact on what the phones deliver, it becomes apparent that Apple's chip engineering skills are right up there with its hardware design and software chops as competitive strengths.

The iPhone X's Face ID unlocking/authentication system leverages the A11's Neural Engine -- a co-processor for running machine learning algorithms that's said to be capable of handling up to 600 billion operations per second -- to quickly analyze a face viewed by its TrueDepth front camera/3D-sensing system, and match it against data within stored within a "secure enclave" on the A11. The Neural Engine also works with the TrueDepth camera to provide face-tracking that can enable augmented reality features, including enhanced Snapchat face masks and the Animojis Apple's Messages app will support.

From the looks of things, the Neural Engine is also used to enable the Portrait Lighting feature supported by the iPhone 8-Plus' rear cameras, and both the front and rear cameras on the iPhone X: It uses AI to provide what Apple declares to be "studio-quality" lighting effects for portrait shots. Meanwhile, a dedicated image processor within the A11 assists with features such as noise-reduction and background blur, while a dedicated video encoder both analyzes frames to optimize video quality and support 4K video recording at 60 frames per second (fps).

And while the iPhone 8 and X aren't the only Apple products to support the company's ARKit augmented reality platform -- it's supported by any iDevice with an A9 or faster processor -- Apple stressed that its newest iPhones will do a better job of running ARKit apps. The Neural Engine's ability to accelerate AI processing plays a role here, as do CPU performance gains and the A11's inclusion of a proprietary GPU said to deliver a 30% performance gain relative to the GPU found in Apple's A10 Fusion processor (prior A-series chips relied on GPU designs from Imagination Technologies). Improved motion sensing, made possible in part by the M11 motion co-processor built into the A11, also helps.

Meanwhile, the A11 continues Apple's tradition of providing sizable iPhone performance gains from one generation to the next without sacrificing battery life. According to Apple, the A11's two high-performance CPU cores provide a 25% performance boost relative to the two high-performance cores found in the A10, while its four low-power cores collectively deliver 70% better performance than the two low-power cores inside the A10. And thanks to a new Apple-designed performance controller, the A11 (unlike the A10) can use all of its cores simultaneously, something said to provide a 70% performance boost for multi-threaded app workloads, which is good news for future iPad Pros.

Jim Cramer and the AAP team hold positions in Apple and Alphabet for their Action Alerts PLUS Charitable Trust Portfolio. Want to be alerted before Cramer buys or sells AAPL or GOOGL? Learn more now.

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Here comes the iPhone. 

Nonetheless, the iPhone 8 and 8-Plus' battery lives are similar, respectively, to those of the iPhone 7 and 7-Plus. The iPhone X, aided by its low-power OLED display, is promised to deliver a two-hour increase in average battery life relative to the iPhone 7.

To recap, the A11 appears to contain at least eight different elements that were designed by Apple's own chip engineers -- high-performance CPU cores, low-power CPU cores, a GPU, AI and motion co-processors, an image processor, a video encoder and a performance controller. The performance gains and power efficiency these elements collectively deliver provide a variety of competitive advantages for the devices that they power.

To be fair, the competition hasn't just been standing by idly. Qualcomm Inc.'s (QCOM) Snapdragon 835 processor, which has gone into many high-end Android phones this year, delivers major power draw improvements relative to the previous generation Snapdragon 820 and 821. Qualcomm also put some effort into optimizing the 835's ability to handle machine learning algorithms -- among other things, it was optimized to handle Alphabet Inc./Google's (GOOGL) TensorFlow machine learning framework. Qualcomm also recently unveiled a 3D depth-sensing solution that will be supported by future Snapdragon processors.

But Apple's newest iPhones have often claimed a big performance edge over rival devices at launch time: Benchmarks run last year for the A10-powered iPhone 7 and 7-Plus showed it trouncing Snapdragon 820-powered devices. And leaked numbers for the iPhone X relating to the popular Geekbench benchmark point to it easily outperforming Snapdragon 835 devices. For AI-related workloads, the difference could be larger still thanks to the Neural Engine.

Most consumers, of course, don't base their smartphone buying decisions on benchmarks. But they probably care about things such as good battery life, the ability to take superb photos and videos and great AR and 3D gaming experiences. And quite a lot of that is made possible by how Apple has turned chip engineering into a core competitive advantage.

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