John Ternus steps in as Apple's chief executive on Tuesday, taking over the world's second-largest company valued at nearly $5 trillion. Starting from lofty heights, Ternus faces the challenge of revving up Apple's innovation engine, especially in artificial intelligence, a domain lacking since the Steve Jobs era. While Tim Cook's brilliance was scaling the company, tripling iPhone sales from 72 million to 255 million annually and multiplying Apple's valuation 13 times, investors now question if growth is priced in.

Apple trades at 33 times next year's earnings, a premium despite earnings growing half as fast as the market. However, Apple faces significant headwinds. In the age of AI, the company has lost its status as the device interaction definer, making it vulnerable to new AI-driven devices from OpenAI and Space X.

Supply chain issues persist, as AI hyperscalers consume chip capacity needed for memory and storage, driving up costs and causing shortages. Furthermore, Apple's continued dependence on China remains a fundamental risk despite Cook's political efforts. A California judge has also slowed Apple's services juggernaut, reducing in-app purchase fees.

Despite these challenges, Apple devices remain more popular than ever, as evidenced by the iPhone 17 Pro's success despite lacking AI features.