Tim Cook: A Steady Go-To Guide for Apple

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Tim Cook, Apple's interim CEO

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By fiscal 1999 these changes had helped push Apple's gross margins up to 28% from 19% in 1997, and the company had swung to a $600 million profit even as sales slumped further. "Cook dramatically cleaned up the balance sheet," says Charles Wolf, analyst at Needham & Co. in New York. "He has been crucial to managing these things, and they translate directly into higher gross margins."

Operational Star Power

Cook was named COO in 2005. At the time, Jon Rubinstein, then senior vice president of the iPod division, departed and went on to become chairman at Palm (PALM). Cook is now responsible for worldwide sales, operations, service, and support in all markets and countries. He is also the head of the Macintosh computer division.

For all his operational star power, Cook isn't the master of marketing and products that Jobs is. In Jobs' absence, product design decisions will likely fall to Jonathan Ive, senior vice-president of industrial design, the man behind the design of the iMac, the iPod, and many other products. "When it comes to design, they most often defer to Ive," Bajarin says.

But don't underestimate Cook, cautions Gartner (IT) analyst Mike McGuire. Having spent more than a decade in Jobs' closely guarded executive circle, Cook will have learned more than a thing or two about how to launch successful products. "I don't know Cook that well, but my guess is he isn't just an ops guy," McGuire says. "I don't think you survive at Apple as just an operations guy. I don't think you get let into the inner sanctum as just an operations guy."

Products Updates Set

In any case, many of the company's planned product releases are likely fully teed up by now and will probably come off without a hitch, even with Jobs sidelined. The next upgrade of the Macintosh operating system, code-named Snow Leopard, is expected sometime this year. There's also the prospect of an update to the iPhone, introduced in 2007 and upgraded in 2008. Some analysts expect a third iteration, a smaller version, sometime in 2009. Other products like the iMac desktop computer and the MacBook line of notebooks, which were updated recently, might be due for incremental improvements, but no major revisions.

"They have a very strong product lineup and a good position in the market," says Michael Capellas, CEO of First Data and former COO of HP. "The challenge is how to deal with the economy as consumer spending drops off."

Jobs is due back in June. In the interim, analysts and other observers say, Apple is in capable hands. "There is no question he's the right guy for the job," says Piper Jaffray (PJC) analyst Gene Munster.

With Heather Green and Steve Hamm in New York.
Hesseldahl is a reporter for BusinessWeek.com.