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Apple CEO Tim Cook inspects the new iPhone 16 during an Apple special event at Apple headquarters on September 09, 2024 in Cupertino, California. Justin Sullivan | Getty Images
As Apple celebrates its 50th anniversary, the company that's defined consumer electronics since introducing the iPod, and that forever changed user behavior in creating the iPhone, faces a host of critical questions about where it goes from here. Apple first became the world's most valuable company in 2011, passing Exxon Mobil , and held that title for large chunks of the decade plus that followed, occasionally getting surpassed by Alphabet or Microsoft . Apple is now second behind Nvidia , which catapulted ahead of all of its tech peers in the last couple years due its position at the heart of the artificial intelligence boom. So far in 2026, Apple's stock is down almost 7%, dropping more than the S&P 500 after underperforming the index last year. For Apple, AI is perhaps the biggest question mark. While the company continues to dominate the U.S. smartphone market and has a services business generating more than $100 billion in annual revenue, it's yet to make a significant splash in AI, as its peers are spending hundreds of billions of dollars combined this year building infrastructure to develop and support the latest models. Siri, Apple's voice assistant, has been slow to evolve, though the company has said a revamp is coming this year. The company's early history, written by the visionary Steve Jobs, has entered a new world, one where iPhones are making incremental advances while the technology surrounding it is in the midst of generational change. CEO Tim Cook, who took the helm shortly before Jobs' death in 2011, turned 65 in November. Cook has dismissed rumors that he's nearing retirement, telling ABC's "Good Morning America" in mid-March that, "I can't imagine life without Apple." Cook and his team have a lot to tackle. Here are five key questions facing Apple as the company enters its second half-century.
What's the 'next iPhone moment' in hardware?
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Apple has 2.5 billion devices being actively used across the globe, giving the company enormous opportunity to make money through apps and other services. But Wall Street has been waiting for Apple to find another breakout. The company killed the Apple Car project, and the Vision Pro goggles remain niche. AI-enabled hardware appears to be where the market is heading through some combination of wearables, robotics, spatial computing or possibly something Apple hasn't shown yet. "I think the biggest question is what comes after the iPhone," said Ben Bajarin, CEO of Creative Strategies. "These are mature categories and we have no idea what comes after that but we do know it will be some form of AI hardware." In January, Bloomberg reported that Apple will be accelerating the development of three upcoming AI wearables all built around Siri: smart glasses, a pendant and AirPods with cameras. Bajarin and other experts who spoke to CNBC said they expect the next device to take the form of glasses. Nabila Popal, an analyst at IDC, said she isn't anticipating any of Apple's expected releases, like a Siri upgrade or foldable phone, to equal "the next iPhone moment." Popal said everyone is looking to Apple to take users "into the AI age." She pointed to Jobs' famous "Think Different" speech in 1997, when the company resurrected its brand. It released the first iMac the next year. "That's the kind of energy that everyone is looking for with the next generation of products," Popal said.
Who will succeed Tim Cook?
Tim Cook, chief executive officer of Apple Inc., center, and Jalen Brunson, basketball player for the New York Knicks, right, during the first day of in-store sales of Apple's latest products at Apple's Fifth Avenue store in New York, US, on Friday, Sept. 19, 2025. The new iPhone 17 is seen as the most significant upgrade Apple has brought to its iPhone lineup in years, with a refreshed design and souped-up camera system. Photographer: Kena Betancur/Bloomberg via Getty Images Bloomberg | Bloomberg | Getty Images
Despite what Cook recently said on "Good Morning America," the CEO is reportedly telling peers he's tired. John Ternus, Apple's hardware boss, could be next in line. Ternus, who's about 15 years younger than Cook, has been with the company for half its life, joining just four years after he graduated from the University of Pennsylvania with a degree in mechanical engineering. He's recently been profiled by The 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 involve an increasingly complex supply chain due to geopolitical tensions, the Trump administration's tariffs and a memory crunch tied to soaring demand for AI chips. Popal called the memory issue "bigger than the pandemic and tariffs." Dipanjan Chatterjee, an analyst at Forrester, said if the Cook era "has been about operational excellence and expansion," the next decade "will be turbulent for Apple because there's been so much change in how consumers interact with technology, particularly with generative AI." Morgan Stanley analyst Erik Woodring said the future of Apple leadership will have to do with "the next generation of product." And Bajarin said that whether Cook's successor is 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 about what they could bring back to product leadership." Popal said the company also needs someone who can handle dealing with governments. "Tim Cook has been the forefront of it," she said. "Apple needs someone that can continue to do that." Apple didn't respond to a request for comment.
How does Apple handle the China conundrum?
China is a critical market for Apple, both for sales of devices and the manufacturing of them. It's a volatile moment, with China and the U.S. involved in a lengthy and costly trade dispute. The world's two largest economies reached a trade truce in October that lowered the effective tariff rate to less than 50% for a year. Cook traveled to China last month for a carefully choreographed visit at an Apple store event tied to the company's 50th anniversary. In fiscal 2025, Apple's revenue from Greater China came in at $64.4 billion, down 11% over two years. Of the company's five geographic areas, its the third biggest by revenue and the only one declining over that stretch. However, the December quarter showed a sharp rebound, with sales in the China region, which includes Taiwan and Hong Kong, surging 38% to $25.5 billion, driven by iPhone sales. "We set an all-time record for upgraders in mainland China, and we saw double-digit growth on switchers," Cook said on earnings day. Upgraders refers to current iPhone users who bought newer models, and switchers means new customers who previously had phones from different brands. Homegrown companies like Xiaomi and Huawei pose stiff competition to Apple. Still, long-term questions persist, and Apple has warned that tariffs, trade restrictions and geopolitical frictions could raise costs, disrupt supply and force restructuring of operations. Apple has spent more than $3 billion on tariffs since President Donald Trump enacted his trade policies. Apple has been pushing production to India and Vietnam, but China is still of central importance. "They've diversified away from China but it's an incredible source of supply and demand and I think China remains a critical part of the Apple story," Woodring said. He said Apple has to show it can reduce geopolitical concentration without denting margins. AI poses another challenge for Apple in China. To operate there, Apple Intelligence must use local engines to filter and censor AI output according to government requirements.
Can devices deliver the AI consumers want?
Matteo Della Torre | Nurphoto | Getty Images
In the absence of a clear AI strategy, Apple is coming under pressure to show that the AI features it rolls out at the device level will be compelling enough to drive upgrades of iPhones and Macs. In January, Apple joined forces with Google to power its AI features, including the forthcoming Siri upgrade. The multiyear partnership will lean on Google's Gemini and cloud technology for future Apple foundational models. Unlike megacap peers Microsoft , Google and Amazon , Apple doesn't have a cloud infrastructure business, and the company has been actively avoiding racking up massive capital expenditures commitments. But consumers are now expecting advanced AI experiences on their devices, and Apple needs to show it can meet their demands. "The one thing that is fundamental about Apple is they don't really lose customers," Bajarin said. "So it's really about can they get new ones?" Bajarin added that a big question is, "Can they increase the value of the ecosystem to existing customers, either by services or new features?" Bajarin said consumers aren't switching phones based on AI features, but that could change in the future. Partnerships, like the one Apple struck with Google, are viewed by many in the industry as the company's best bet at improving things like Siri. Will that continue to be enough? "I still think there are questions around what AI means to Apple's identity. And frankly, the strategy has been a bit uncertain over the last two years," Woodring said. "But, I think when they see an opportunity that is serious or significant, you'll see them execute on it."
Can Apple maintain its status as a premium brand?
A man holds the newly released MacBook Neo during the "Special Apple Experience" launch event at the Apple Store in the Manhattan borough of New York City, on March 4, 2026. Timothy A. Clary | Afp | Getty Images
While the iPhone still generates the most revenue for Apple, the Services segment, which includes the App Store, iCloud, Apple Music, Apple Pay and the newly launched Apple Business platform, drives the bottom line. The company recently added more options like advertising on its maps product and the App Store. Apple said in December that it would increase the number of App Store ads. It also introduced its first low-priced computer, the MacBook Neo, and discontinued its high-priced Mac Pro desktop. Cheaper items can be a good way to monetize more of its services in the future and lock in more users, Woodring said. "I still think they're trying to figure out exactly how to be differentiated at the low end" Woodring said, adding that Apple's devices aren't necessarily a high-growth area anymore. Analysts say Apple has to figure out how to maintain its premium brand and keep it from getting diluted it as the company goes downstream. "We've seen in the last few years Apple uncharacteristically stumbling in terms of redefining their experience of subsequent cycles of the iPhone," said Forrester's Chatterjee. "Yet, we really have not seen any kind of desertion from that ecosystem, so whatever they've built is still good enough, but it's unclear how long they can maintain that." Advertising is another test for Apple. It's a business model that's turned Google and Meta into juggernauts, but one Apple long avoided. Going that route presents a different customer experience. "That's something Apple will have to wrestle with because of the user," Chatterjee said. "The user is sacred." WATCH: Apple's core business still doing very well
