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In naming hardware boss John Ternus as its new CEO on Monday, Apple also announced another key promotion that may be almost as significant in gauging the company's direction. Taking over for Ternus as head of hardware will be Johny Srouji, who leads the team that makes Apple's in-house chips. Apple created a new title for Srouji, chief hardware engineer, that's effective immediately. Ternus will become CEO on Sept. 1. Ternus and Srouji make for a formidable pair as Apple marches toward in-house development of all of its chips for iPhones, Macs, AirPods and more. It's a strategy, years in the works, that allows Apple to tightly integrate hardware and software and develop the specific features it needs, while avoiding unnecessary use of precious compute power, the two execs told CNBC in 2023. "Because we're not really selling chips outside, we focus on the product and that gives us freedom to optimize," Srouji said at the time. "And the scalable architecture lets us reuse pieces between different products."
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In December, Srouji dismissed rumors that he was planning to leave as several other executives were exiting. His new role underscores Apple's commitment to a silicon strategy that's poised to assume increased significance as artificial intelligence gains greater prominence on devices. Under Srouji's leadership, Apple started making more types of chips, reducing reliance on outsiders like Intel , Qualcomm and Broadcom . While Ternus has, for months, been viewed as the frontrunner to replace Cook, who turned 65 in November, locking in Srouji is viewed by many analysts as an equally critical move. "We believe putting Srouji in the newly created Chief Hardware Officer role is the most incrementally positive announcement from Apple," analysts from Oppenheimer wrote in a report on Tuesday. "Apple not only retains one of the world's best chip designers, but also ensures its integrated silicon/hw/sw playbook is reserved and enhanced." Following stints at Intel and IBM , Srouji joined Apple in 2008, less than a year after the company launched the first iPhone with a core processor made by Samsung. A month after Srouji arrived at Apple, the company bought chip startup P.A. Semiconductor for $278 million, and was off to the races. Srouji and his team launched Apple's first custom processors for iPhones in 2010. Custom silicon is now one of the hottest trends in tech, as Google , Amazon, Meta , Microsoft and Tesla have all turned inward for AI chips to reduce their reliance on Nvidia's scarce and costly graphics processing units. When it comes to cloud workloads, Apple relies on Google's tensor processing units (TPUs), instead of Nvidia's chips.
'Constrained by what was available'
In the 2023 interview with CNBC, Ternus said the "most profound change at Apple" in his more than two decades at the company was "how we now do so many of those technologies in house, and top of the list of course is our silicon." "We've always had an incredible design team and we made these beautiful products, but they were constrained by what was available," Ternus said. One of Apple's biggest supply chain efforts in Cook's latter years was to start onshoring production. All the tech giants primarily manufacture their chips at Taiwan Semiconductor Manufacturing Co .'s fabrications plants in Asia, and at TSMC's new fabs in Arizona. Nvidia recently dethroned Apple as TSMC's biggest customer. Apple's growing chip prowess includes a major commitment to manufacture at TSMC's Arizona campus — and at Texas Instruments' two new U.S. factories. As part of a $600 billion U.S. investment commitment through 2029, Apple said in August that it's "leading the creation of an end-to-end silicon supply chain in the United States." Apple execs told CNBC in 2023 that its chip team had scaled to thousands of engineers working across chip labs all over the world, including in Israel, Germany, Austria, the U.K., Japan and the U.S.
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While Apple doesn't currently make data center chips for running AI workloads in the cloud, some analysts predict it may partner with Broadcom on a server chip as soon as this year. To date, Apple has focused almost entirely on AI capabilities on the end device, an approach the company says gives its users and their data top-notch security and privacy. "Their goal is to continue to be the best place to run AI software, and everybody who tests or runs AI stuff on Apple silicon continues to say they're the best," said Ben Bajarin, CEO of Creative Strategies. Apple's key in-house chips are the M-series processors for Macs, which replaced Intel processors starting in 2020, and its A-series chips at the heart of iPhones. Both are known as systems-on-a-chip, or SoCs. When Apple unveiled its latest A19 and M5 generations in 2025, they included built-in neural accelerators for powering AI on the device. Srouji said in 2023 that Apple has an advantage in AI because "we own the silicon, the hardware, the software, the machine learning all in one team." The company says it builds neural accelerators into each GPU core, allowing developers to more quickly switch between different tasks. Apple announced its original neural engine for AI in 2017. When it comes to modems, Apple began moving away from Qualcomm in 2019 with the purchase of the majority of Intel's modem business for $1 billion, following the settling of a series of lawsuits with Qualcomm. Apple quietly released its first iPhone modem, the C1, in early 2025, and unveiled the C1X in the iPhone 19 in September. Bajarin predicts all iPhone modems will be made by Apple by the end of next year. "If they never catch up to Qualcomm in performance, I don't think that's a deal-breaker even on Pro phones," Bajarin said. "I think it just needs to work well for your coverage area, be fast enough and not kill your battery."
Consolidating under Srouji
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