Apple's New CEO May Shake Up Strategy with Aggressive Approach

Apple's new CEO, John Ternus, is expected to take a more aggressive approach than Tim Cook in managing the company. According to Bank of America analyst Wamsi Mohan, Ternus may pursue bolder strategies, including increased R&D spending and higher capital expenditures.

Mohan maintained his Buy rating on Apple stock (AAPL) with a price target of $380, implying roughly 22% upside from the current price of $311.30. The analyst believes that Cook's discipline-focused approach may give way to a more innovation-driven strategy under Ternus' leadership.

Under Cook's tenure, Apple's market capitalization grew from approximately $350 billion to $4 trillion, while annual revenue nearly quadrupled and active installed base expanded to over 2.5 billion devices. However, BofA warns that a shift in strategy could temporarily compress margins before new revenue streams offset the investment.

The analyst points out that Apple's departure from its net-cash-neutral objective is a signal that management may be more willing to deploy capital under Ternus. The firm expects the company to explore new categories, including AI glasses, camera-equipped AirPods, and smart rings, which would require significant R&D investment and carry execution risk.