(News Bulletin 247) – Luca Maestri, the company’s CFO since 2014, will leave this position on January 1st while continuing to exercise certain functions within the company. An important leader in the post-Steve Jobs era, the Italian maintained a dialogue with investors by providing them with important information.

One Apple announcement sometimes hides another. On Monday, the Apple group announced the date of its highly anticipated keynote (September 9) during which the group should unveil the iPhone 16.

On the same day, the Cupertino company delivered another communication, much less public but perhaps just as critical for the market: a change of financial director.

Luca Maestri, who has held the position since 2014, will step down from the role on January 1, the company announced. After that date, the Italian will remain with the company, where he will continue to lead the “Corporate services” teams and report directly to CEO Tim Cook. The executive will be replaced as CFO by Kevan Parekh, currently vice president of financial planning and analysis.

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A key man

A graduate of the Luiss University of Rome (one of the major Italian universities along with Bocconi in Milan and the University of Bologna) and Boston University, Luca Maestri joined Apple in 2013, after previously working at Xerox and General Motors.

He embodies one of the great figures of the post-Steve Jobs era of Apple. During his tenure, Apple’s revenues doubled while those of services (including the App Store) increased more than fivefold.

Like many CFOs of big American tech companies, Luca Maestri plays the role of key contact for analysts and investors. The executive accompanies Tim Cook during conference calls dedicated to the presentation of the company’s financial results.

He is also the one who tends to give the most details and information to analysts during these meetings, sometimes influencing the stock price. For example, Luca Maestri had indicated in November 2023 that the company expected stable revenues in the current quarter, while analysts were expecting growth of 5%.

A smooth transition

Financial directors, depending on the group, exercise more or less influence, but are often considered “keymen”, that is, key people for the company.

The unexpected announcement of their departure can cause the market to freeze. The cloud computing specialist OVHcloud suffered this in 2022. The same thing happened to Alstom in May 2023, after its CFO, Laurent Martinez, decided to join Orange. A few months later, the company announced a resounding warning about its cash generation, and its stock lost more than 37% in a single session.

In the case of Apple, Luca Maestri’s departure appears to be orderly, and therefore announced four months in advance. Moreover, the market is not panicking, with Apple shares barely falling this Tuesday in pre-opening (-0.1%).

“Apple’s choice to take an internal successor should make the transition a little smoother… Any change of this magnitude creates uncertainty, especially given Luca Maestri’s consistency and historical execution,” Piper Sidler analysts were quoted by Reuters as saying.

Upgrade cycle

The announcement of Luca Maestri’s departure comes at a key moment for Apple. Long considered to be lagging behind the big tech giants in artificial intelligence, the Apple group managed to turn things around in June by presenting its advances in the field. But the company still has to demonstrate that its new iPhones, which would integrate new AI features, can appeal to consumers and thus accelerate growth.

Recall that one of the major elements of Apple’s valuation is the company’s ability to create an “upgrade cycle”, that is, a cycle during which consumers will buy a new iPhone to replace their old aging device. According to Wedbush, 270 million iPhones worldwide (out of an installed base of 1.5 billion) are more than four years old.

“Given Apple’s significant achievements in AI, the key driver now will not only be the new features introduced, but also, and more importantly, the pricing,” said Naeem Aslam of Zaye Capital.

“In terms of design, Apple has been unable to produce anything revolutionary for a long time, and the same goes for its features, a fact with which rivals like Samsung have pleasantly surprised their consumers. However, today, the focus is mainly on price and accessibility; the time when Apple could set its own prices is over; it must now adapt to the real purchasing power of consumers and take into account factors such as inflation and the damage it has caused,” he explains.