Incoming Apple CEO John Ternus will face pressure from all sides when he takes over from current company boss Tim Cook in September, not the least of all, dealing with the rising price of memory and other components, reports the Financial Times.
As reported earlier this month, Apple CEO Tim Cook is stepping down, and John Ternus is taking his place. Cook will become executive chairman of Apple’s board of directors and Ternus, currently the senior vice president of Hardware Engineering, will become Apple’s next chief executive officer effective on September 1, 2026.
When Ternus takes over, he won’t face an easy job. He’ll be forced to deal with rising costs, while also being forced to placate investors, customers, and the Trump administration.
Welcome to the tightrope, John Ternus.
Ternus is facing ever-increasing prices for the memory chips used in its devices, particularly its popular iPhone. Apple has so far managed to insulate itself from much of the price hikes the industry faces, thanks to having favorable contracts with several of its suppliers. However, those contracts are not valid forever.
Industry executives, supply chain experts, and industry analysts the Financial Times spoke to told the publication that Ternus will face some massive decisions as soon as he sits in the CEO chair.
In addition to making future decisions about Apple’s moves, he’ll also either benefit from, or forced to deal with, supply chains that were made before he took charge.
Memory costs currently account for a 10% share of the iPhone bill of materials. However, that share is expected to rise as high as 45% by the end of 2026. This is thanks to the Artificial Intelligence industry’s insatiable appetite for RAM. This means there are plenty of companies out there willing to pay a premium for memory and other components, meaning Apple doesn’t have the usual advantage when it comes to dictating terms and getting other preferential treatment.
Apple will also continue to face pressure from US President Trump’s administration, as it is pushing Apple and other tech firms to return manufacturing back inside US borders.
“US investment will be one of the critical drivers of Apple’s strategy over the coming years,” said Samik Chatterjee at JPMorgan. “For John Ternus, the question is: how do I position the company to be on the right side of both Washington and Beijing?”
While Apple has been making moves to invest in the US – initially pledging to spend $600 billion into US operation, later pledging an additional $400 million – it is also been moving device and component production out of China and to other countries, like India.
That said, Apple won’t be 100% out of China for a long time, if ever. That means, Ternus must also make moves to placate Chinese officials.
As I said previously, welcome to the tightrope, John Ternus, your juggling balls will be right out shortly.
