Apple turns to hardware veteran Ternus as CEO to succeed Cook in AI age

Apple has named longtime hardware boss John Ternus as its next CEO on Monday, turning to another insider to steer the iPhone maker after Tim Cook.

Cook, a supply-chain genius who boosted Apple's market value by $3.6 trillion in his 15 years at the helm, will stay on as executive chairman when Ternus takes over on September 1, Apple said in a statement.

Ternus, who joined Apple in 2001, has played a central role in reviving products such as the Mac, which has gained market share against PCs. Though he has kept a low public profile, he has been deeply involved in shaping Apple's biggest products such as iPads and AirPods.

The transition comes at a crucial time for Apple. After years on top of the most-valuable company scoreboard, Apple has lost its crown to AI chipmaker Nvidia, as investors have fretted over its lack of innovation in the technology that is changing how people work, create, and get information.

In January, Apple struck a deal with its longtime rival in smartphones, Alphabet's Google, to use Google's Gemini in an effort to improve its Siri virtual assistant.

Despite introducing a form of AI to the public imagination in 2011 with Siri, Apple has not yet scored a hardware or software product hit centered on new AI technologies, while emerging rivals such as OpenAI's ChatGPT have attracted hundreds of millions of users.

In particular, Siri has not yet become an "agent" - the term that AI firms use for systems that carry out complex tasks like a human assistant.

"I expect his biggest challenge and efforts will be focused on getting a better AI story and offering together that relies more on Apple's own capabilities and less on third parties," said Bob O'Donnell, head of tech consulting firm TECHnalysis Research.

APPLE GAVE TERNUS AIRTIME RECENTLY

At 50, Ternus is the same age Cook was when he took over CEO duties from Apple co-founder Steve Jobs.

Apple, which rarely allows its executives to speak publicly, has sought to elevate Ternus' profile in recent years, having him speak with the press about Apple's products.

He showed off the iPhone Air in September, the biggest revamp of the firm's top-selling product in nearly a decade.

Ternus will also have to fend off rivals such as Meta Platforms, whose augmented-reality glasses have become a surprise hit with just a fraction of the capabilities and price tag of Apple's $3,499-plus Vision Pro headset. Nvidia, too, has announced its own personal computer and is working on chips that can power laptops.

"The promotion of Mr. Ternus indicates the company will focus on new hardware devices such as folding phones, glasses, VR devices, and AI pins," said Gil Luria, managing director of D.A. Davidson & Co.