Five key questions Apple faces entering its second half-century

Like Apple As the company that has defined consumer electronics since introducing the iPod and changed user behavior forever when creating the iPhone celebrates its 50th anniversary, it faces a series of critical questions about where the business will go next.

Apple it was the first The world’s most valuable company in 2011 ExxonMobiland he held that title for much of the following decade, at times surpassing it. Alphabet or Microsoft. Apple is now in second place Nvidiawhich has surpassed all its technology peers in the last few years due to its location at the heart of the artificial intelligence boom.

So far in 2026, Apple’s shares are down nearly 7%, falling more than the S&P 500 following the index’s underperformance last year.

Artificial intelligence is perhaps the biggest question mark for Apple. While the company maintains its dominance of the US smartphone market and has a services business that generates more than $100 billion in annual revenue, it has yet to make a significant leap into AI as its peers have spent hundreds of billions of dollars combined this year to develop and build infrastructure to support the newest models. Development of Apple’s voice assistant Siri has been slow, but the company has said a refresh is coming this year.

The company’s early history, written by visionary Steve Jobs, ushered in a new world where iPhones were making increasing advances and the technology surrounding it was in the midst of generational change.

CEO Tim Cook, who took over shortly before Jobs’ death in 2011, turned 65 in November. Cook denied rumors that he was nearing retirement, saying “I can’t imagine life without Apple” on ABC’s “Good Morning America” ​​in mid-March.

Cook and his team have a lot to overcome. Here are five key questions facing Apple as the company enters its second half-century.

Apple has 2.5 billion devices in active use worldwide, giving the company a tremendous opportunity to make money through apps and other services.

But Wall Street expected Apple to find another exit. company Apple killed the Car project and its Vision Pro glasses remain niche. AI-powered hardware seems to be where the market is moving towards wearables, robotics, spatial computing, or possibly some combination that Apple hasn’t shown yet.

In January, Bloomberg reported that Apple speeding up Development of three AI wearable devices that will all be built around Siri: smart glassesa necklace and AirPods with camera.

Speaking to CNBC, Bajarin and other experts said they expect the next device to be in the form of glasses. Nabila Popal, an analyst at IDC, said she doesn’t expect any of Apple’s anticipated releases, such as a Siri upgrade or a foldable phone, to equal “the next iPhone moment.”

Popal said everyone is looking to Apple to usher users into the “age of AI.” He noted Jobs’ famous “Think Different” speech in 1997, when the company revived its brand. The following year, it released the first iMac.

“This is the kind of energy everyone is looking for in next-generation products,” Popal said.

Despite what Cook recently said on “Good Morning America,” CEO reportedly He tells his friends that he is tired.

Apple’s hardware boss John Ternus could be next.

Ternus, who is about 15 years younger than Cook, has been with the company for half his life, joining the company just four years after graduating from the University of Pennsylvania with a degree in mechanical engineering. Recently profiled New York Times And Bloomberg. His portfolio includes oversight of the hardware engineering teams behind the iPhone, iPad, Mac, Apple Watch, AirPods and Vision Pro.

Some of Apple’s biggest challenges include an increasingly complex supply chain due to geopolitical tensions, tariffs from the Trump administration and memory shortages due to rising demand for artificial intelligence chips. Popal called the memory issue “bigger than the pandemic and tariffs.”

The Cook era “has been about operational excellence and expansion,” said Dipanjan Chatterjee, an analyst at Forrester, who said the next decade will be turbulent for Apple because there are so many changes in how consumers interact with technology, especially generative AI.

Morgan Stanley analyst Erik Woodring said the future of Apple’s leadership will be about “next-generation products.” Bajarin said Cook’s successor is either Ternus or Craig Federighi, senior vice president of software engineering: “These are definitely more engineer-operator type CEOs, and I think the market is happy with what they can bring back to product leadership.”

The company also needs someone who can handle business with governments, Popal said.

“Tim Cook has been at the forefront of this,” he said. “Apple needs someone who can continue to do this.”

Apple did not respond to a request for comment.

China is a critical market for Apple, both in terms of sales and production of devices. It’s a volatile moment when China and the United States are embroiled in a long and costly trade dispute. The world’s two largest economies reached a trade truce in October that reduced the effective tariff rate to below 50% for a year.

Cook traveled to China last month for a carefully choreographed visit to an Apple store event tied to the company’s 50th anniversary.

Artificial intelligence poses another challenge for Apple in China. Apple Intelligence needs to use native engines to operate there. filter and censorship AI output as per government requirements.

In the absence of a clear AI strategy, Apple is under pressure to show that the AI ​​features it offers at the device level will be compelling enough to spur upgrades of iPhones and Macs.

Apple in January joined forces with Google To power AI features, including the upcoming Siri upgrade. The multi-year partnership will rely on Google’s Gemini and cloud technology for future Apple base models.

The company recently added more options such as: advert in the maps product and on the App Store. Apple in question It will be in December increase Number of App Store ads. It also introduced its first low-priced computer, the MacBook Neo. stopped high priced Mac Pro desktop.

Woodring said cheaper products could be a good way to make more money from its services in the future and lock in more users.

“I think they’re still trying to figure out exactly how to differentiate on the lower end,” Woodring said, adding that Apple devices are no longer a high-growth area.

Analysts say Apple needs to figure out how to maintain its premium brand and prevent it from being diluted as the company moves downwards.

“Over the last few years, we’ve seen Apple stumble uncharacteristically in redefining its experience with later iterations of the iPhone,” Forrester’s Chatterjee said. “We haven’t seen any breakout from that ecosystem, though, so whatever they’ve built is still good enough, but it’s unclear how long they can keep it up.”

Advertising is another test for Apple. This is a business model that evolved into Google and Meta grew into juggernauts, but an Apple was long avoided. Going this route offers a different customer experience.

“This is something Apple will have to deal with because of the user,” Chatterjee said. “The user is sacred.”

WRISTWATCH: Apple’s core business is still doing very well