Tim Cook and John Ternus Apple
Tim Cook (right) hands Apple's reins to John Ternus on 1 September, closing a 15-year run that grew the company to $4 trillion. Tim Cook/X

Apple has tapped 25-year hardware engineer John Ternus as its next chief executive, ending Tim Cook's 15-year run atop a $4 trillion (£2.96 trillion) company and setting up a possible shift back to product innovation from the services empire Cook built.

The Cupertino company confirmed on 20 April that Cook, 65, will step down on 31 August and become executive chairman. Ternus, 50, Apple's senior vice president of Hardware Engineering, takes over as chief executive officer (CEO) on 1 September.

Cook's $109 Billion Services Legacy

Cook, who took over from Steve Jobs in 2011, spent 15 years turning Apple from a gadget maker into a subscription powerhouse. In fiscal 2025, the services segment brought in $109.2 billion (£80.8 billion), up 14% year over year, according to Apple's annual 10-K filing. That revenue covers Apple Pay, Apple Music, Apple TV, iCloud, AppleCare, the App Store, and advertising.

The December 2025 quarter alone generated $30 billion (£22.2 billion) in services, the first time the segment cleared that threshold in a single quarter. Gross margins on services sit above 75%, compared with roughly 36% on hardware. That gap is why Wall Street treats services as the engine of Apple's $4 trillion (£2.96 trillion) valuation.

Ternus inherits that engine but did not build it.

A Hardware Engineer at the Top

Ternus joined Apple in 2001 after four years as a mechanical engineer at Virtual Research Systems, a defunct firm that built some of the earliest commercially available virtual reality (VR) headsets. He rose to vice president of Hardware Engineering in 2013 and to senior vice president in 2021.

In that role, he oversaw every major product launch since 2021, including iPhone 17, iPad Pro, M-series Macs, AirPods, Apple Watch Ultra 3, and Vision Pro. Cook said Ternus has 'the mind of an engineer, the soul of an innovator' and called him 'the right person to lead Apple into the future.'

Johny Srouji will become Chief Hardware Officer, consolidating Ternus's former portfolio, while Tom Marieb takes direct leadership of the Hardware Engineering unit. Srouji will oversee this unified group, acting as a bridge to the new CEO, with Marieb reporting to him.

What it Means for iPhone Users

More than 2.5 billion Apple devices are active worldwide. Any change at the top affects pricing, feature roadmaps, and which categories get the next big investment.

Bloomberg's Mark Gurman reported last month that Ternus has long sat in Apple's 'conservative camp' on speculative product bets. He opposed the now-cancelled Apple Car and was wary of the Vision Pro, drawing on his 1990s VR experience and viewing Apple's spatial computing push with far less enthusiasm than Cook.

For iPhone buyers, that caution could mean fewer expensive experiments and more focus on refining the device that still delivers over half of Apple's revenue. iPhone sales hit $85.27 billion (£63.12 billion) in the December quarter on the back of the iPhone 17 launch.

Smart Glasses and the AI Test Ahead

The first strategic test will be Apple's long-rumoured smart glasses and its artificial intelligence (AI) push. Cook reportedly wants Apple to beat Meta to market on augmented reality (AR) glasses, and Ternus must decide whether to accelerate or pull back.

He will also have to keep growing services revenue that Apple's finance team projected could expand at a similar 14% pace through fiscal 2026. Services do not run themselves, and investors will watch for any sign that the new CEO is taking his foot off the subscription pedal.

Ternus, Apple's youngest executive team member when promoted in 2021, said he is 'humbled to step into this role.' Cook joins the board as chairman on 1 September.

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