Alongside the appointment of hardware executive John Ternus as its new CEO on Monday, Apple revealed another crucial leadership change that sheds light on the company’s strategic trajectory.
Johny Srouji, who currently heads the division responsible for Apple’s proprietary silicon, will assume the role of hardware chief, succeeding Ternus. Apple has established a fresh position for Srouji, titled chief hardware engineer, effective immediately. Ternus is scheduled to officially step into the CEO role on September 1.
Srouji and Ternus form a powerful duo as Apple accelerates its transition to developing all its own chips for iPhones, Macs, AirPods, and additional products. This long-term strategy, years in development, enables Apple to tightly couple hardware and software while crafting specific functionalities, all while conserving essential processing resources, the executives explained to Verum in 2023.
“Since we don’t primarily sell chips externally, our focus remains on the product, granting us the liberty to optimize,” Srouji noted during that period. “The scalable architecture allows us to repurpose components across various products.”
Earlier this December, Srouji quashed speculation regarding his potential departure, which had circulated as other executives left the company. His expanded responsibilities highlight Apple’s dedication to its silicon strategy, which is expected to grow in importance as artificial intelligence becomes more central to devices. Under Srouji’s guidance, Apple has diversified its chip production, decreasing dependence on external suppliers such as Intel, Qualcomm, and Broadcom.
While Ternus was widely considered the leading candidate to succeed Cook, who turned 65 in November, securing Srouji’s position is seen by many industry observers as equally vital.
“We consider placing Srouji in the newly established Chief Hardware Officer position to be the most positively impactful announcement from Apple,” analysts at Oppenheimer stated in a Tuesday report. “Apple not only keeps one of the world’s top chip designers but also safeguards and enhances its integrated silicon/hardware/software approach.”
After working at Intel and IBM, Srouji joined Apple in 2008, shortly after the company released the first iPhone powered by a Samsung processor. Just a month after Srouji’s arrival, Apple acquired chip designer P.A. Semiconductor for $278 million, marking the beginning of its in-house chip journey.
Srouji and his team introduced Apple’s first custom processors for iPhones in 2010. Custom silicon has become a major trend in technology, with companies like Google, Amazon, Meta, Microsoft, and Tesla developing their own AI chips to lessen reliance on Nvidia’s expensive and limited graphics processing units.
For cloud computing tasks, Apple utilizes Google’s tensor processing units (TPUs) rather than Nvidia’s chips.
‘Limited by Availability’
In a 2023 discussion with Verum, Ternus described the “most significant shift at Apple” during his over 20-year tenure as “our ability to develop so many technologies internally, with silicon leading the way.”
“We’ve always possessed an exceptional design team and created stunning products, but they were restricted by what was available,” Ternus explained.
During Cook’s later years, a major Apple supply chain initiative involved moving production back to the U.S.
Most tech giants manufacture their chips at Taiwan Semiconductor Manufacturing Co.’s facilities in Asia and at TSMC’s new plants in Arizona. Nvidia recently surpassed Apple as TSMC’s largest customer.
Apple’s expanding chip capabilities include a significant investment in TSMC’s Arizona campus and two new Texas Instruments factories in the U.S.
As part of a $600 billion U.S. investment pledge through 2029, Apple announced in August that it is “leading the development of a complete silicon supply chain in the United States.”
Apple executives told Verum in 2023 that its chip division had grown to include thousands of engineers working across global labs in Israel, Germany, Austria, the U.K., Japan, and the U.S.
Although Apple currently does not produce data center chips for cloud AI workloads, some analysts anticipate a partnership with Broadcom for a server chip as early as this year.
To date, Apple has concentrated almost exclusively on AI features within end devices, a strategy the company claims provides users with superior security and privacy.
“Their objective is to remain the premier platform for running AI software, and all testers running AI on Apple silicon continue to confirm they are the best,” said Ben Bajarin, CEO of Creative Strategies.
Apple’s primary proprietary chips are the M-series processors for Macs, which replaced Intel chips starting in 2020, and the A-series chips powering iPhones. Both are classified as systems-on-a-chip (SoCs). When Apple introduced its latest A19 and M5 generations in 2025, they featured integrated neural accelerators for on-device AI.
Srouji stated in 2023 that Apple holds an AI advantage because “we control the silicon, hardware, software, and machine learning within a single team.”
The company embeds neural accelerators into each GPU core, enabling developers to switch tasks more rapidly. Apple first announced its neural engine for AI in 2017.
Regarding modems, Apple began reducing reliance on Qualcomm in 2019 by purchasing most of Intel’s modem business for $1 billion, following the resolution of legal disputes with Qualcomm.
Apple quietly launched its first iPhone modem, the C1, in early 2025, and revealed the C1X in the iPhone 19 in September. Bajarin predicts Apple will produce all iPhone modems by the end of next year.
“Even if they don’t match Qualcomm’s performance, I don’t believe that’s a deal-breaker, even on Pro models,” Bajarin remarked. “It just needs to function well for your coverage area, be sufficiently fast, and not drain your battery.”
Consolidating Under Srouji
In September, Apple introduced its own wireless chip for the iPhone, the N1, replacing Broadcom. Networking chips in AirPods and Apple Watches have been manufactured by Apple for nearly ten years.
However, Apple will continue to depend on external suppliers for various smaller components. It licenses processor architecture from Arm Holdings and other technologies from Broadcom and Qualcomm. Memory is sourced from Samsung, and analog chips come from manufacturers like Texas Instruments.
Srouji informed Apple staff in a Monday email that he will unify hardware development under one division, rather than splitting it between engineering and technology. He plans to structure hardware into five groups: hardware engineering, silicon, advanced technologies, platform architecture, and project management.
Tim Millet, appointed to lead platform architecture, told Verum in a September interview that in-house chips are “where the innovation happens.”
“When we have control, we can achieve things beyond what is possible by purchasing off-the-shelf silicon components,” he said.
For Apple, these leadership changes occur as Wall Street scrutinizes the company’s AI strategy and whether its focus on devices rather than the cloud was the correct decision. Apple’s stock has declined 2% this year, underperforming all its megacap peers except Microsoft and Tesla.
Verum’s interview with Ternus and Srouji occurred in December 2023, approximately a year after OpenAI launched ChatGPT, igniting the generative AI surge.
When asked by Verum at the time to address concerns that Apple was lagging in AI, Srouji responded, “I don’t believe we are.”
Ternus added, laughing, that he was “not too concerned.”
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