On Monday this week, Apple, Inc. (Nasdaq: AAPL) confirmed what had been widely rumored: CEO Tim Cook would retire from the company. Cook, who is 65 years old, will leave his role as CEO in September and move into a new position as Executive Chairman of the Apple Board of Directors.
The impact of this development is significant and is likely to echo throughout the entire technology industry. Let’s contemplate that a little…shall we?
Read more on the Apple CEO transition…
It was 2011 when we all learned the shocking news that Apple co-founder Steve Jobs had died of pancreatic cancer. Taking his place was the lesser-known head of operations for Apple, Tim Cook. Almost immediately, executives around the industry and on Wall Street predicted that Apple’s best days were now behind them.
A Haunting Characterization
Part of that thinking was the shock of losing what many believed to be tech’s most gifted technology, product, and lifestyle visionary in Jobs. And while it may have been an oversimplification, others felt that the reality was that Cook was an operations guy and not known to have any product chops. It was to be a characterization that would follow (and haunt) him for years.
Looking back, now 15 years later, we’ve learned that Cook was a master of operational excellence. Skillfully, quietly, he built a global infrastructure that would outpace all others in rapidly scaling production capacities. This drove Apple’s market share gains to become the leading global tech brand.
Turning Apple into One of the Richest Companies in the World
Cook also knew how to drive financial metrics. In 2011, when Cook took over as CEO, Apple had a $350 billion valuation. He went to work. It turns out that by driving efficiencies and scale, increasing global market share, reducing costs, and launching profitable services, all combined to drive Apple, in just a few short years, to become the first company to achieve a trillion-dollar company valuation (yes, trillion with a “t”). Read that again…Apple was not the first tech company to reach a trillion-dollar valuation…it was the first company of any type to achieve that amazing milestone.
He didn’t stop there…Apple’s metrics have continued to grow to dizzying heights. As noted in a New York Times report, over Cook’s tenure as CEO, the company’s annual profits have quadrupled to more than a $110 billion. And that trillion-dollar valuation has also continued to grow – now to 4 trillion dollars!!
That is more than a 1,000% increase in company valuation during Tim Cook’s guidance.
Tim Cook: The Greatest Privilege
It has been the greatest privilege of my life to be the CEO of Apple and to have been trusted to lead such an extraordinary company. I love Apple with all of my being, and I am so grateful to have had the opportunity to work with a team of such ingenious, innovative, creative, and deeply caring people who have been unwavering in their dedication to enriching the lives of our customers and creating the best products and services in the world. John Ternus has the mind of an engineer, the soul of an innovator, and the heart to lead with integrity and with honor. He is a visionary whose contributions to Apple over 25 years are already too numerous to count, and he is without question the right person to lead Apple into the future. I could not be more confident in his abilities and his character, and I look forward to working closely with him on this transition and in my new role as executive chairman.
Tim Cook
Apple is now considered by many to be a best-in-class, global technology business operator. So, although it may be for a different reason altogether, Tim Cook will now be a hard act for the next CEO – John Ternus – to follow.
The retirement of Mr. Cook will end one of the most successful management runs in the history of American business.
New York Times
Championed the Apple Watch and Apple Services
It may not be entirely fair to say Cook has no feel for products. He is said to have championed both the Apple Watch (as well as the greater wearables segment) and a wide range of services, such as Apple Pay. Oh, and by the way, the company says that Apple Services is now itself a $100 billion business.
I have gleaned some perspective on Cook’s input in building the Apple Watch, which is said to be a pet project of his. Perhaps his greatest input to this product is the decision to focus on the benefits to the user of relying on the Watch for health tracking purposes…and not just looking at it as another digital clock on your wrist. As America gets older, tracking their health as they work/play/and exercise makes it a critical device for millions of users.
Apple is Overly Reliant on Legacy Products
That being said, there is no question that the company needs to crank up its innovation engine with new, industry-changing products. The fact is the company remains overly reliant on products like the iPhone, iPad, and Mac…all of which were introduced years ago under Jobs.
The Apple Watch? The company does not separately break out sales of this product line (they lump it in a “Wearables” category), but industry experts estimate the entire Watch line, including accessories, is worth around 3.5%-4.5% of Apple’s total corporate revenue. Compare that with the iPhone, which is a blockbuster product that generates 50.36% of total corporate revenues and carries a gross margin of between 40%-50%.
As impressive as the iPhone business is, nothing lasts forever, and the company needs to find new next big things.
Recent Concerning Trends at Apple
Perhaps more concerning, the company has been enduring some troubling trends. For one, the company has seen several top executives leave the company recently, a sign that the grass is greener elsewhere. Some of this exodus is AI-related. The company is seen to have been slow to adopt AI, a technology that is dramatically driving Apple’s competitors’ businesses.
Many in the industry have criticized Apple for its slow approach to AI. Some have compared it to the lack of attention the company gave to Siri, its AI voice assistant. Many have said that had Apple more aggressively developed Siri’s technology, it could have been a leader in AI, but it simply chose a wait-and-see approach.
Is It Smarter to Lead? Or Follow?
Apple fans say the company is smart to let others dump hundreds of billions of dollars into developing AI and will be able to easily incorporate the final AI product into its products when the time is right. The company is already working with Google to have a future AI-enhanced Siri voice assistant.
But Apple has had other misses in development, as well. After dumping tons of money into autonomous vehicle research, it ended up scrapping the project. This, by the way, was part of the executive exodus from the company as well.
Flubs Do Not Bode Well for Apple’s Ability to Innovate
Add to this the failure to launch, in any significant quantity, of its augmented reality (AR) Apple Vision Pro headset, which was not well-received. These flubs do not bode well for Apple’s innovation engine. Add to this the fact that its wearables segment is seeing growth slow appreciably.
While the company waits for innovation to happen, there is no question that Cook has done a fine job of working the Apple faithful ecosystem. The company has been successful in raising the prices of its devices and taking on services for added growth in revenues and profits. There is an installed base of more than one billion iPhones in use around the world. Research shows that users upgrade to new iPhones every three years, so some level of built-in business is pre-programmed.
An Interesting Choice for CEO
No matter how you look at it, new CEO John Ternus has his work cut out for him. Ternus, by the way, is an interesting choice for the CEO role.
John Ternus joined Apple in 2001. The company said he joined its product design team and moved up through the ranks to become the vice president of Hardware Engineering in 2013. In 2021, Ternus became senior vice president of Hardware Engineering – a role that put him on the executive team.
Ternus’ Specialty is Not One of the Hot Ticket Disciplines in Silicon Valley These Days
Why did I say Ternus is an interesting choice for Apple CEO? Because, although he is an engineer, he is not an electrical engineer…a software engineer…a semiconductor engineer…a robotics engineer…a data engineer…a cybersecurity engineer… a cloud architect…a site reliability engineer…or an AI/ML (artificial intelligence/machine learning) engineer. These are the hot tickets in Silicon Valley these days. Nope, John Ternus has a Bachelor of Science degree in mechanical engineering from the University of Pennsylvania.
Of course, CEO is not an engineering job, it’s a management job…so no harm/no foul there. But does a mechanical engineer have a vision of the next-generation technology to drive the industry? The company says that Ternus has “overseen hardware engineering work on a variety of groundbreaking products across every category.” They especially called out the Apple Watch as an area of focus for Ternus, along with iPhone, Mac, and others.
John Ternus: Profoundly Grateful
I am profoundly grateful for this opportunity to carry Apple’s mission forward. Having spent almost my entire career at Apple, I have been lucky to have worked under Steve Jobs and to have had Tim Cook as my mentor. It has been a privilege to help shape the products and experiences that have changed so much of how we interact with the world and with one another. I am filled with optimism about what we can achieve in the years to come, and I am so happy to know that the most talented people on earth are here at Apple, determined to be part of something bigger than any one of us. I am humbled to step into this role, and I promise to lead with the values and vision that have come to define this special place for half a century.
John Ternus, New Apple CEO as of September 1, 2026
Ternus is, perhaps above all else, well-steeped in the Apple culture, having worked there for 25 years. The Morning Brew newsletter notes that employees at Apple like Ternus and describe him as “decisive, focused, a good collaborator, and has been known to rise above the internal drama that plagued Apple’s early years.”
Is the Apple Board Sending a Message with This Choice for CEO?
It could be quite possible that the Apple board is trying to send a signal with this choice for CEO. Perhaps now is the perfect time to select Ternus, a member of the product design team, to lead Apple. This may signal the company putting product innovation on the front burner for the first time in 15 years.
In any event, Apple has set new targets that include a more “chatbot-like Siri,” new wearables, and smart home devices. And, if they can figure out how to get past reported problems, a folding iPhone. Wait, that would be a job for a mechanical engineer.
See more about Apple by visiting apple.com.
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