Tim Cook is handing the Apple CEO role to John Ternus, a 25-year company veteran who most recently ran hardware engineering. Cook grew Apple from a $350 billion company when he took over in 2011 to a $4.7 trillion giant today, and he plans to stay on as executive chairman during the handover.
Apple's next CEO won't have to navigate the transition alone. Cook is staying on as executive chairman once Ternus takes the top job, a setup very different from the one Cook inherited from Steve Jobs, who was gravely ill and unable to offer ongoing guidance.
Cook's record sets a high bar
When Cook took over Apple in 2011, the company had a market cap of around $350 billion. That figure now stands at $4.7 trillion. Apple shares trade at $328.21, up 1.0% on the day.
Ternus brings deep institutional knowledge to the role. He is a 25-year Apple veteran who joined the company's product design team in 2001, and his most recent role put him in charge of Apple's hardware engineering business. That background puts him in what Cook's tenure suggests is the most important part of Apple's business: making products customers love.
AI and pricing pose the next test
However, Ternus faces a different set of pressures than Cook did at the start. Apple has yet to stake out a material position in the artificial intelligence space, focusing mostly on integrating the technology into its existing products rather than investing heavily in AI infrastructure.
That caution comes with a cost. Apple has already hiked prices, and Ternus will likely have to raise them further at a time when consumers are stretched. Given Apple's reliance on consumer spending, the new CEO faces real headwinds from the start.
Still, Cook's ongoing availability as executive chairman and Ternus' long run through Apple's key product roles argue against writing him off before he starts.
Source: Fool
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