00:00Introduce us to Mr. Ternus. What does your reporting tell us about his new workload and also that signal that he's climbing the ranks here?
00:09John Ternus has been Apple's Senior VP of Hardware Engineering since 2021.
00:14That means he runs all hardware development for essentially every Apple product.
00:18He's in charge of the iPhone, in charge of the iPad, in charge of the Mac, now in charge of the Apple Watch.
00:23And he's been elevated to expand his role this year a couple times, taking, like I said, full oversight of the Apple Watch, but also taking charge of Apple's AI robotics teams.
00:34Now, very recently, Tim Cook put him in charge of overseeing Apple's design teams for both hardware and software.
00:40Now, design is the look and feel of the products, what the interface looks like, what the icons look like, how the software works.
00:47Industrial design are things like the shapes of the devices, the colors, the weight, and the feel.
00:52It goes well beyond the engineering of making everything work.
00:55And like you said, design is one of the most critical and prestigious functions at Apple.
01:00It's really only been run by the most senior executives in the company's history, people like Johnny Ives, Steve Jobs himself, Tim Cook himself, and the COO, Jeff Williams, who retired a few months ago.
01:13Now, John Ternus adds to that list, and it's yet another strong indicator that he's being groomed for a larger role and is at the very top of the short list of frontrunners of potential Tim Cook successors at one point when Cook ultimately does decide to retire.
01:29Mark, what's interesting is how subtly this was done.
01:32And I'm sure that's because they don't want to aggravate too much the investor base, but also those also in the running.
01:37Talk about who else we could see being lined up in some way.
01:41This is a very strange setup organizationally.
01:45The design teams are overseen by Ternus, but on paper, they report to CEO Tim Cook.
01:51Various reasons why you'd want to do that.
01:53Apple previously announced that Cook would be running the design team, so you don't want to take that away from him publicly and undermine the CEO.
02:00You don't want to get into a debate about who's better suited to run design, whether that's an engineer or an operations person like Cook.
02:07In terms of other CEO candidates, there's really only one other at this point.
02:12That's Sabi Khan, the chief operating officer.
02:15Other publications have thrown out names like Eddie Q, Greg Joswiak, Greg Federighi, Deirdre O'Brien.
02:21Nothing I've heard points to any of them being CEO other than maybe in an emergency-like scenario.
02:27It's really Ternus or the new COO, Sabi Khan.
02:30Mark, we have 10 seconds.
02:31What's the one product that Ternus is going to be zeroed in on this year?
02:36This year, it's got to be the foldable iPhone.
02:39This is going to be a potential growth driver for company revenue, and we'll see him front and center for that in September.
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