NEW YORK, April 20 (Reuters) – Apple shares declined 1% in after-hours trading on Monday after the communications hardware firm said its chief executive, Tim Cook, would step down after nearly 15 years at the helm of the world’s second most-valuable company. The decision by Cook, 65 years old, to step aside in favor of longtime Apple hardware chief John Ternus took Wall Street by surprise and will raise questions about whether the new chief can maintain the brisk pace set by his predecessor.
Cook will become executive chairman on September 1 as the iPhone maker gears up for industry change spurred by artificial intelligence. He succeeded Apple founder Steve Jobs when he took over and turned the firm into a global brand that churns out hundreds of millions of units annually. He will give way to a company insider known for his focus on design and product.
Apple said of Cook:
“Under Cook’s leadership Apple has grown from a market capitalization of approximately $350 billion to $4 trillion, representing a more than 1,000% increase, and yearly revenue has nearly quadrupled, from $108 billion in fiscal year 2011 to more than $416 billion in fiscal year 2025. The company has expanded its global footprint substantially, particularly in emerging markets; it is now in more than 200 countries and territories. Apple operates over 500 retail stores and has more than doubled the number of countries in which its customers can visit an Apple Store. During his tenure, Apple has grown by more than 100,000 team members and increased its active installed base to more than 2.5 billion devices.”
The decision will guarantee Apple’s next quarterly report, due a week from Thursday on April 30, will be even more closely watched than usual.
COMMENTS:
RICK MECKLER, PARTNER, CHERRY LANE INVESTMENTS, NEW VERNON, NEW JERSEY:
“Tim Cook did an amazing job. And I’m not surprised that the initial reaction is for the stock to be a little bit lower. But he will be executive chairman. I imagine he’ll still be part of the larger strategy of the company.
“He has been an incredibly successful CEO coming into a situation that you thought would be hard to replace the person before. I hate to see him leave the CEO spot, as an investor.”
ART HOGAN, CHIEF MARKET STRATEGIST, B. RILEY WEALTH MANAGEMENT, BOSTON:
“He would never leave if the numbers were going to be bad, so I think that that’s the important thing. They’re about to report numbers, and you know they’re going to be good. You know the guidance is going to be positive. And you know we’re going to start hearing more about how they are going to use artificial intelligence to improve their products.”
“He’s been a transformational Apple CEO that’s always had a steady hand at the wheel. I think that will be his legacy. He had massive shoes to step into, and he was the right person for the job. That’s the way he’ll be remembered.”
TIM GHRISKEY, SENIOR PORTFOLIO STRATEGIST, INGALLS & SNYDER, NEW YORK
“The company has done very well. And you know, its stock price, the value of the company, have increased dramatically. A lot of that is being in the right place at the right time, but I think they’ve made the right moves, and I think they’ve grown their user base.
“Earnings are upcoming, so he probably wanted to get it out there, so it didn’t become an issue in the earnings.”
(Reporting by Lewis Krauskopf, Noel Randewich; editing by Colin Barr)