Ternus' AI Challenge: Can Apple Keep iPhone Relevant Amidst Competitors' Aggressive AI Push
Apple's new CEO, John Ternus, has just eight days to address a critical question at an upcoming hardware event: how will Apple's iPhone stay relevant in an era dominated by AI-powered devices.
The company is facing historic headwinds as competitors like Microsoft and Alphabet are aggressively investing in AI research and development. According to CNBC's MacKenzie Sigalos, the pressure on Apple is not just about meeting quarterly targets, but also about changing minds about where the next computing interface will live.
Ternus takes over at a time when Apple's stock price is near a record high, with shares rising 2.61% on his first day and trading at $325.13, up 40.58% over one year and 19.92% year to date. However, the AI question looms large as Apple's R&D spending of $11.73 billion per quarter is dwarfed by Microsoft's planned capex of roughly $175 billion in FY27.
While a foldable iPhone could help Apple close ground on Samsung and reset the upgrade cycle, it would not address the underlying AI question. Ternus will need to convince investors that the iPhone can stay at the center of the computing experience as rivals start experimenting with entirely new AI-native devices.