Departure exemplifies iPhone maker's move to services from
product development
By Tripp Mickle
This article is being republished as part of our daily
reproduction of WSJ.com articles that also appeared in the U.S.
print edition of The Wall Street Journal (June 28, 2019).
Apple Inc. said design chief Jony Ive will leave the company
later this year to form his own independent design company, marking
the end of an era at the iPhone maker as it shifts from an emphasis
on product development to services.
Mr. Ive's departure announcement Thursday comes after several
years in which he has become less involved in the day-to-day
business and design work at Apple, people close to the designer
said. It nevertheless means the removal of Apple's most prominent
leader after Chief Executive Tim Cook and the person who most
embodies the design wizardry achieved by Apple under its late chief
Steve Jobs.
The announcement is sure to raise new questions about the
company's ability to develop and launch new products. It comes as
sales have largely plateaued for the iPhone -- which Mr. Ive helped
design and which fueled Apple's surging sales and profit for most
of a decade.
Apple is seeking new avenues for growth, largely from the sale
of app software, entertainment content, financial tools and other
services. In April, it reported its first back-to-back drop in
quarterly sales and profit in more than two years, after saying in
January that those two measures had fallen in the holiday quarter
for the first time ever.
Mr. Ive's planned new company will count Apple among its primary
clients, and he will continue to work closely on projects with
Apple, the company said. It said the design team Mr. Ive now
manages will be headed by two vice presidents who will report to
Chief Operating Officer Jeff Williams -- effectively demoting the
team. Mr. Ive, whose title is chief design officer, reports
directly to Mr. Cook.
"After so many years working closely together, I'm happy that
our relationship continues to evolve and I look forward to working
with Jony long into the future," Mr. Cook said in a statement.
Apple shares, which have been rising in recent weeks but remain
well below their record, fell around 1% in after-hours trading
Thursday following the announcement.
A close acolyte of Mr. Jobs, Mr. Ive was critical to Apple's
revival from near bankruptcy in the 1990s, working alongside the
Apple co-founder to design a string of product hits, including the
iPod, iPhone and iPad, that transformed Apple into one of the
world's most valuable companies.
But, despite his prominence in Apple's management, Mr. Ive has
been less engaged in the day-to-day business at the company since
he helped spearhead the launch of the Apple Watch in 2015, people
close to the designer said.
Mr. Ive's departure seemed inevitable as the company
transitioned to being focused on selling services from its history
of selling devices, said one of the people close to the designer.
"It's not a product and design company any more," this person
said.
Mr. Ive, in Apple's announcement, said the design team today "is
stronger, more vibrant and more talented than at any point in
Apple's history."
Mr. Cook, whose expertise is in operations, seldom visited the
design studio, and Mr. Williams, also an operations expert, cut his
product teeth by working on the smartwatch that the company
launched in 2015.
Mr. Ive's frequent absence in recent years coincided with
questions from analysts and former employees about Apple's ability
to innovate. While sales of the watch have grown in recent years,
Apple hasn't had another massive hardware hit since the iPad in
2010. Mr. Ive's reduced presence also has contributed to a series
of recent departures from the close-knit team, which had four of
its designers leave over the past year.
After the watch's launch, Mr. Ive spent about two years working
on Apple's new headquarters, which was billed as an homage to Mr.
Jobs, who died in 2011. Mr. Ive returned to lead the design team in
late 2017. He continued to split time between the U.S. and U.K.
during that period, partly because his father has been ill, people
close to the designer said.
Mr. Ive and his wife want to spend more time in the U.K., where
he and his wife want to raise their children, people close to the
designer said.
The departure will end a golden era of design at Apple. Under
Mr. Ive, the design team reigned supreme at the company, calling
the shots on how products looked and what functions they
performed.
Mr. Ive assumed leadership of the design team in 1996, before
which Apple worked with outside design firms to develop new
products. He built a team of about two dozen close-knit designers
who worked together to develop the tech giant's simple aesthetic
and spearheaded the development of products including the
iPhone.
The announcement raises additional questions about the future of
the design team. Apple said Evans Hankey would serve as vice
president of industrial design. Her role over the past year as an
operations chief for the industrial design group had contributed to
some recent departures, people close to the designer said.
Apple also named Sabih Khan senior vice president of operations,
elevating the longtime lieutenant of Messrs. Cook and Williams into
a higher role as the company deals with a host of supply-chain
challenges stemming from $300 billion in proposed tariffs on
Chinese imports that would affect all of Apple's major
products.
Dow Jones & Co., publisher of The Wall Street Journal, has a
commercial agreement to supply news through Apple services.
Write to Tripp Mickle at Tripp.Mickle@wsj.com
(END) Dow Jones Newswires
June 28, 2019 02:47 ET (06:47 GMT)
Copyright (c) 2019 Dow Jones & Company, Inc.
Apple (NASDAQ:AAPL)
Historical Stock Chart
From Aug 2024 to Sep 2024
Apple (NASDAQ:AAPL)
Historical Stock Chart
From Sep 2023 to Sep 2024