By Rolfe Winkler

It took two quarters for Tim Cook to save Apple from what was almost a disastrous year.

President Trump's on-again, off-again tariffs risked massively increasing the company's costs. A pending court ruling imperiled Apple's lucrative Google contract. Plus, the company was seen as lagging on artificial intelligence.

Facing so much uncertainty, Apple tumbled to a market capitalization of $2.6 trillion in April and lost its title as the world's most valuable company.

Six months later, Cook pushed Apple's market value above $4 trillion for the first time. That's more than 10 times what the company was worth when Cook took over as chief executive from Steve Jobs 14 years ago.

During Cook's years at the helm, Apple hasn't unveiled a revolutionary technology or introduced a new product that will reshape people's lives the way the iPhone did. Instead, Cook, who turns 65 on Saturday, has won over shareholders by doing just enough to protect and grow the business, a conservative strategy that has been on display this year with clever political and legal maneuvering and enticing new iPhones.

Scariest to Apple investors had been the threat of tariffs and Trump's direct criticism of Apple's supply chain. Apple remains largely reliant on huge manufacturing operations built up in China over more than 20 years, a supply chain Cook himself built when he was head of Apple's operations.

With most iPhones still made there, investors panicked on "Liberation Day" in April when Trump announced massive import tariffs. Apple's stock cratered more than 20% in the days that followed.

Cook was already in position to avoid the worst from a U.S. trade war with China. He had been shifting the final assembly of more iPhones to India for several years, so he was able to reroute more India-assembled phones to the U.S. to dodge the tariffs on China.

That didn't please Trump. "We're not interested in you building in India. India can take care of themselves," Trump said in May, referring to Apple.

But Apple's supply chain is never coming back to the U.S., not in any substantial way, current and former employees say. Among other advantages, Asia has pools of both skilled and cheap labor that aren't available domestically.

During Trump's first term, Cook learned he can win over the president by giving him a good headline. In 2018, Apple promised to invest $350 billion in the U.S. over five years -- primarily spending the company was already planning to make, say people familiar with the calculations.

In 2019, facing potential tariffs on China, Cook personally lobbied Trump, explaining how such levies would increase iPhone prices and help foreign rivals. Then Apple reversed its decision to move production of its Mac Pro computer to China from Texas, and Cook led Trump on a tour of the Austin factory. "Today I opened a major Apple manufacturing plant in Texas," Trump boasted. Actually, the factory had been open since 2013, and it made a niche product. Cook didn't correct Trump.

The strategy worked. Trump scaled back tariff threats during his first term, giving exceptions to electronics like the iPhone.

So Cook deployed the strategy again. In August, Cook said he was increasing Apple's promised U.S. investments to $600 billion over four years. He made the announcement next to Trump in the Oval Office, as he gave him a plaque with a base of gold.

Again, Cook gave up little, making promises primarily on already planned investment, said the people familiar with the figures. Investments include making AI servers in Texas and offering manufacturing training for U.S. businesses in Detroit. Specific figures Apple announced were a $2.5 billion commitment to make iPhone cover glass in Kentucky with longtime supplier Corning, and a $500 million partnership to produce rare-earth magnets in the U.S.

What Cook isn't doing is committing to make Apple's popular products in the U.S.

After the U.S. investment pledge, Trump announced Apple would be exempt from a tariff on imported electronics, leaving the company subject to only a smaller China tariff, which Trump agreed to cut in half on Thursday.

That's not the only blow Cook avoided this summer. During the penalty phase of an antitrust trial against Google, a judge held in his hands the ability to cancel payments Google makes to Apple for placement as the default search engine in Apple's Safari web browser.

Such a move would have cost Apple dearly. The contract generates more than $20 billion of revenue a year for Apple, nearly all of which falls to the bottom line, accounting for roughly a fifth of the company's operating profit, analysts estimate.

Cook sent lieutenant Eddy Cue to testify. Apple's senior vice president in charge of services told the judge he "lost a lot of sleep thinking about" the possible disappearance of the Google contract and testified that technology shifts are so powerful they can take down even the most massive companies. The subtext: The judge didn't need to impose harsh penalties; the market would take care of itself.

The judge gave Google a slap on the wrist and said the competitive dynamics of the marketplace were changing already, largely because of AI. Notably he said prohibiting search-distribution payments would harm companies such as Apple. As one analyst said at the time: "Apple didn't just dodge a bullet; they dodged a missile."

Just after Labor Day, Cook welcomed hundreds to Apple's spaceship campus to unveil his newest generation of iPhones. A new, thinner smartphone dubbed the iPhone Air was the star of the show. But its weaker camera, single speaker, smaller battery and high price tag have combined to make the device less popular with customers.

Nothing stood out as a game changer; perhaps the biggest cheer among those in attendance was for a camera sensor that enables landscape photos without turning a phone to the side.

Even so, Apple delivered just enough new features across the rest of its iPhone 17 lineup that many customers are upgrading. On Thursday, Apple projected up to 12% revenue growth in the holiday quarter, double Wall Street's estimate, thanks to strong iPhone sales.

The company has faced criticism for being slower to deliver flashy AI advancements while rivals make huge investments.

But the stock has been supported, in part, by $100 billion in annual share buybacks, and revenue continues to grow because of Cook's focus on delivering products that have become ubiquitous in people's lives. His motto has been be best, not first.

Many forget that the first-generation AirPods almost nine years ago were widely mocked as expensive Q-tips that were easily lost. They had been a challenging product to develop, and Cook stuck with them. Now they are a must-have iPhone accessory that generate billions of dollars in annual sales. So is the Apple Watch, which evolved from a somewhat marginal digital fashion statement into a widely used health and fitness device.

All the while, Cook has milked the iPhone ecosystem for more revenue each year, selling apps, subscriptions and App Store ads, and squeezing bigger payments from Google. All those services surpassed $100 billion in revenue this past fiscal year for the first time, at a higher profit margin than device sales. News Corp, owner of The Wall Street Journal, has a commercial agreement to supply news through Apple services.

The knock on Cook since the day he took over is that he isn't a "product guy" like his predecessor. Jobs paid frequent visits to Apple's design studio where future products were in development. Cook doesn't stop by as much, preferring to focus on operations. Yet on his watch, Apple built its own semiconductor operation that designs some of the best chips in the world.

When Cook eventually steps down, some analysts want the company to appoint a more visionary, product-minded CEO who can better innovate in the age of AI. Neither he nor the company has suggested that is imminent, and he is widely expected to continue as executive chairman once he leaves the CEO post.

Write to Rolfe Winkler at Rolfe.Winkler@wsj.com

(END) Dow Jones Newswires

October 31, 2025 20:00 ET (00:00 GMT)

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