When former Apple CEO Steve Jobs handed over the reins to Tim Cook in 2011, he left him with a simple piece of advice: “Don’t ever ask what I’ll do. Just do the right thingFifteen years later, that advice appears to have paid off. Under Cook, Apple’s market value has risen more than 1,000%, while annual revenues have nearly quadrupled to $416 billion last year.
Now, as Cook prepares to step down, he is conveying his own guidance to John Ternos, the longtime Apple executive who will take over as CEO in September. Ternos, who joined Apple in 2011 and currently serves as senior vice president of hardware engineering, will inherit a company at the peak of its financial success — along with a new set of challenges, including defining Apple’s long-term AI strategy.
“For John, I think my advice — or what I told him — is that one of the most important decisions he’s going to make is where he spends his time, and I’m going to spend it where it’s most beneficial to the company and users,” Cook said during Apple’s second-quarter earnings call today (April 30). Cook added that the next CEO must also remember that products that enrich people’s lives remain Apple’s “north star.”
Cook’s comments came as Apple beat Wall Street expectations for revenue and profits. Quarterly sales rose 17 percent year over year to $111.2 billion, while net income increased 19 percent to $29.5 billion. The iPhone led the way, generating $56.9 billion in revenue, a 21 percent increase fueled by the launch of the iPhone 17e in March. Cook described the iPhone 17 lineup as “the most popular lineup in our history.”
Other sectors also recorded gains. Mac revenue rose 6% to $8.3 billion, helped in part by the introduction of the more affordable MacBook Neo. iPad sales increased by 8%, while wearable devices, including the Apple Watch, grew by 5%. Meanwhile, Apple’s Services division, which includes Apple News and Apple TV, generated record revenues of $31 billion.
According to Cook, Apple’s strong performance makes this an ideal moment for a leadership transition. “This transitional moment is the right moment for a number of reasons: First, our business has performed very well,” he said, noting the company’s current strength and future roadmap. He also described Ternos as “the right leader, ready to step into this role.”
For his part, Ternos praised Cook’s leadership style, highlighting his thoughtfulness, diligence and financial discipline. He said he plans to continue those qualities when he takes office in September.
However, Ternus will face significant challenges from day one. The most important of which is Apple’s position in the artificial intelligence arms race. The company is under pressure to prove its ability to compete against major technology companies such as Google and Microsoft. Its current approach of rolling out “Apple Intelligence” and relying in part on third-party AI models has yet to gain full traction.
Asked about monetizing AI, Cook pointed to Apple’s increasing investment in research and development as an indication of its ambitions. Spending on research and development rose to $11.4 billion this quarter, compared to $8.5 billion last year. “We invest in products and services, and we see opportunities in both,” Cook said. “We couldn’t be more excited about how the future is going.”
