Apple Inc. (NASDAQ:AAPL) entered the John Ternus era Tuesday as investors weighed how the new CEO will tackle artificial intelligence, new products, and capital deployment while following Tim Cook’s 15-year run.
Ternus Takes Over A $4.6 Trillion Apple
Ternus succeeded Cook as CEO, while Cook moved into the executive chairman role.
Cook inherited Apple with a market value below $350 billion in 2011 and leaves Ternus with a roughly $4.6 trillion company spanning hardware and services.
Apple shares gained 2,258% during Cook’s tenure, or 2,716% including dividends, compared with a 757% total return for the S&P 500.
SWBC Chief Investment Officer Chris Brigati told Bloomberg that Cook expanded Apple’s growth engines through a different approach from Steve Jobs. Brigati said Ternus ideally will combine Cook’s steady leadership with the product innovation associated with Jobs.
Jensen Investment Management portfolio manager Allen Bond described Cook as a steady hand through major technology shifts. Bond told Bloomberg that Apple Services is one of Cook’s biggest successes, with fiscal 2025 revenue exceeding $109 billion versus $16 billion in fiscal 2013.
AI And New Products Shape Ternus Era
Ternus faces an early test at Apple’s Sept. 9 event, where the company is expected to introduce a foldable iPhone alongside other products.
Bond identified AI as Cook’s biggest weakness and pointed to Apple’s decision to appoint a CEO with an engineering and product background.
Bank of America Securities analyst Wamsi Mohan remains bullish on Apple, reiterating a Buy rating and $380 price forecast.
Mohan expects Ternus to preserve much of Apple’s core while strengthening its position in AI-powered devices. He believes Apple can use its silicon, privacy standards, operating systems and installed base to “cement Apple’s device dominance in an AI-enabled era.”
Mohan also sees opportunities in smart glasses, smart rings, camera-equipped AirPods, home automation and robotics.
Apple brings substantial financial flexibility into the transition. Analysts expect about $156 billion in free cash flow in 2027, giving Ternus room to invest in products, acquisitions or manufacturing, the Financial Times reported Tuesday, citing Visible Alpha.
Apple’s Leadership Ranks Keep Changing
Ternus also inherits continued executive turnover.
Longtime executive Phil Schiller stepped away from leadership of the App Store and product events while remaining an Apple Fellow. Services chief Eddy Cue will take greater responsibility for the App Store, while several other veteran executives have departed or moved into smaller roles, Bloomberg reported Monday.
Cook told employees he has “enormous comfort” in Ternus and said, “few people understand what it takes to build products that change the world the way John does,” Bloomberg reported Monday.
Top ETF Exposure
- iShares S&P 100 ETF (NYSE:OEF): 9.48% Weight
- HCM Defender 100 Index ETF (NYSE:QQH): 9.81% Weight
- NYLI US Large Cap R&D Leaders ETF (NASDAQ:LRND): 9.49% Weight
Significance: Because AAPL carries such a heavy weight in these funds, significant inflows or outflows will likely force automatic buying or selling of the stock.
Apple Price Action
AAPL Stock Price Activity: Apple shares were up 2.42% at $324.51 at the time of publication on Tuesday, according to Benzinga Pro data.
Photo courtesy of Apple
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