Apple's New CEO Faces His First Major Test: An AI Product That Works

John Ternus steps into the chief executive role at Apple Inc. with a singular challenge that eluded his predecessor: delivering a breakthrough artificial intelligence product that can compete with rivals who have seized the early lead in the AI era.

Tim Cook, who announced his retirement after more than a decade at Apple's helm, leaves behind a company with record revenues, a $3 trillion market capitalization, and a product ecosystem that reaches billions of users. But according to industry observers, he also leaves behind an unfinished chapter in AI—one that Ternus must now write.

The AI Gap Cook Couldn't Close

While competitors raced ahead with consumer-facing AI products, Apple's efforts have lagged visibly behind. "Tim Cook was a great CEO, but he didn't crack AI," according to an analysis in Wired, which frames AI development as "job number 1 for John Ternus."

The contrast is stark. OpenAI's ChatGPT reached 100 million users within months of launch. Google integrated its Gemini AI across search, productivity tools, and Android devices. Microsoft embedded AI assistants into Windows and Office. Meanwhile, Apple's Siri—once a pioneering voice assistant—has become a punchline for missed queries and limited capabilities.

Apple has made incremental AI improvements across its product line, from computational photography in iPhones to on-device machine learning for features like Live Text and predictive typing. But the company has yet to unveil a flagship AI product that captures public imagination or shifts competitive dynamics in its favor.

What Ternus Inherits

Ternus, who previously led hardware engineering and oversaw the development of Apple Silicon chips, takes charge of a company with formidable advantages. Apple controls the full stack—hardware, software, and services—giving it unique leverage to integrate AI deeply into devices. Its emphasis on privacy and on-device processing offers a differentiated approach in an industry where cloud-based AI models dominate.

The company also sits on enormous cash reserves and employs thousands of AI researchers and engineers. What it has lacked, observers suggest, is a cohesive AI strategy that translates technical capability into products users want.

Ternus's hardware background may prove advantageous. Apple's custom silicon, particularly the Neural Engine components in its chips, provides infrastructure for running AI models locally—a potential competitive edge as privacy concerns mount around cloud-based AI services.

The Stakes for Apple's Future

The pressure on Ternus extends beyond product development. Investors are watching whether Apple can maintain its premium market position as AI reshapes computing. Competitors are embedding AI into operating systems, browsers, and productivity software—the very layers where Apple has historically controlled the user experience.

If AI assistants become the primary interface for tasks currently performed through apps, Apple risks losing its App Store-centered business model. If generative AI tools become essential for knowledge work, Apple's devices could lose relevance among professional users who anchor themselves to AI-native platforms.

The timeline matters, too. Each quarter without a compelling AI offering allows competitors to deepen user habits and lock in advantages. Network effects in AI—where models improve as more users provide data—favor early movers.

What Success Might Look Like

Industry watchers will be looking for signals of Ternus's AI strategy in the coming months. A successful approach might involve reimagining Siri as a genuinely capable assistant, integrating generative AI into creative apps like Final Cut Pro and Logic, or launching entirely new product categories that leverage AI in ways competitors cannot easily replicate.

Apple has historically succeeded by entering markets late but executing better than pioneers. It did not invent smartphones, tablets, or wireless earbuds—but it defined those categories through superior design and ecosystem integration. Whether that playbook works for AI remains an open question.

What we know: John Ternus becomes Apple CEO at a moment when the company faces intense competitive pressure in artificial intelligence. Tim Cook's tenure delivered financial success but left AI as an unresolved strategic challenge. What's unclear: Whether Ternus will pursue a breakthrough consumer AI product, double down on privacy-focused on-device AI, or chart an entirely different course—and whether Apple's late entry into the AI race will prove a disadvantage or an opportunity to learn from competitors' missteps.