Last month, Apple announced that CEO Tim Cook would be stepping down on September 1, 2026 with John Ternus, its existing hardware chief, to take the mantle. Now, it appears that Ternus’ appointment marks a new era of Apple not only when it comes to future products, but also in spending.
As per a report from Bloomberg, John Ternus will likely change how Apple manages its cash flow. Under Tim Cook, the Cupertino giant focused on buybacks and dividends for shareholders. Now, John may be changing the playbook when it comes to handling money, with a focus on spending the cash for the company’s future products and acquiring talent.
John Ternus to change Tim Cook’s Apple cash playbook
When Tim Cook succeeded Steve Jobs as CEO in 2011, one big change he made was to focus on dividends and buybacks. Jobs had historically opposed using the company’s cash to pay high dividends, as he had more of a conservative view of Apple’s cash, shaped in part by the company’s near-bankruptcy in the 1990s.
Cook, by contrast, moved to make Apple more shareholder-friendly by restoring a quarterly dividend in 2012 and expanding stock repurchases. Over time, Apple returned more than $1 trillion to shareholders through dividends and buybacks, while also broadening its investor base and building a valuation that reached $4 trillion.
And now, John Ternus is expected to turn things around. As per the report, under Ternus, Apple may keep more of its cash for acquisitions, hiring and research rather than treating large shareholder returns as a fixed priority.
Apple to no longer be cash neutral
Since 2018, Apple had aimed to remain net cash neutral, meaning it wanted its cash and debt levels to stay broadly balanced. In its latest earnings call, Apple’s chief financial officer Kevan Parekh said, “As we move ahead, we are no longer providing net cash neutral as a formal target, and we will independently evaluate cash and debt.”
As per reports, such a move would not have been made without Ternus’ sign-off or influence. It is expected that the company will now use the extra cash to make investments needed to support the business.
The report states that many engineers and product designers inside Apple have for some time argued that the company should retain more of its cash instead of returning it, so that it can fund major acquisitions, recruit talent and expand research and development.
Do note that Apple’s biggest acquisition so far remains its $3 billion purchase of Beats Electronics in 2014.
John Ternus is cooking something at Apple
The new strategy will allow Apple to have a lot more cash for its products. Previously, John Ternus has teased that the company has an incredible road map of products ahead. This includes devices like the rumoured iPhone Fold, and also AI with a revamped Siri expected to launch later this year.
Ternus said last month, “This is the most exciting time in my 25-year career at Apple to be building products and services.”
