Apple’s executive exodus sends a signal about its AI strategy

Apple ( AAPL ) is undergoing a major shakeup among its top executives. The exodus includes Jeff Williams, now former COO and former frontrunner to succeed Tim Cook as CEO. AI chief John Gianandrea; Government Affairs major Lisa Jackson; Vice President of Design Alan Dye, who is moving to META, and General Counsel Kate Adams.

In a vacuum, each move looks like something that happens during the normal course of business at a company as big as Apple. But with the departures coming so soon, you’d be forgiven for wondering if the company is in crisis mode.

But from a fundamental point of view it is not exactly like that. Apple’s stock price is near an all-time high, the company’s market cap is over $4 trillion, and it reported record iPhone sales in its most recent quarter, with even higher expectations for Q1.

Services revenue is growing, and Apple is reportedly preparing to launch a low-cost MacBook that could sell to schools and price-conscious consumers, according to TF International Securities’ Ming-Chi Kuo.

Still, there’s one glaring problem that Apple needs to fix: failing to field an AI competitor that can match Google’s ( GOOG , GOOGL ) or Microsoft’s ( MSFT ) AI services.

And while Apple hasn’t said any of the departures are related to its AI woes, analysts point to at least two, Gianandrea and Dye, as changes in strategy.

“I think the changes are largely because Cook wants to shake things up,” Gene Munster, managing partner at Deepwater Asset Management and a longtime Apple watcher, told Yahoo Finance.

“And instead of being a follower in AI, he wants to be a leader,” he added. “So I think it’s more than just a simple infection. I think … it’s a big deal.”

Gianandrea previously served as Apple’s vice president of machine learning and AI strategy, which has struggled to keep pace with services such as Google’s Gemini for Android phones. AI researcher Amar Subramanya is replacing Gianandrea as Apple’s vice president of AI and will report to software chief Craig Federighi.

Apple’s next-generation Siri, which the company first touted in 2024, has been delayed until sometime in 2026. According to Bloomberg’s Mark Gurman, Apple also has problems with its own AI models and will instead pay Google $1 billion a year to power the company’s Gemini voice assistant. Apple will switch to its own models when they are ready.