A new report from the Financial Times suggests that Apple’s incoming CEO, John Ternus, will step into the role facing two immediate and high-stakes challenges. Chief among them are decisions around future iPhone pricing and a broader reshaping of the company’s global manufacturing strategy, particularly across the United States, China, and India.
According to the report, Ternus will need to respond to a rapidly shifting cost environment—especially when it comes to memory components. Apple has traditionally held strong leverage over its suppliers, but that balance is changing. Surging demand driven by artificial intelligence infrastructure has significantly increased competition for memory, pushing prices upward. Estimates indicate that Apple could see RAM costs rise by more than 400% within the next year.
Such a jump would dramatically alter the cost structure of the iPhone. Memory, which once accounted for roughly 10% of total component costs, could climb to nearly half of the bill of materials, placing considerable pressure on profitability.
This creates a difficult strategic choice for the new CEO. Apple can either absorb the higher costs—reducing its margins—or pass them on to consumers through higher device prices. Neither path is without consequences: lower margins may concern investors, while price increases could dampen consumer demand.
Beyond pricing, Ternus is also expected to oversee adjustments to Apple’s manufacturing footprint. The company has been gradually expanding production in India as part of a diversification strategy, but this shift has reportedly strained relations with China. Previous reports suggest Chinese authorities have taken steps that complicate Apple’s efforts to grow its operations outside the country.
Amid these geopolitical tensions, current CEO Tim Cook is expected to transition into an executive chairman role and continue handling sensitive government relations. By taking the lead on negotiations with officials in both Washington and Beijing, Cook would allow Ternus to focus more directly on product development and operational leadership during the transition.
