The Kitchen is Closed: Tim Cooks His Last Batch of iPhones

Hey Superheroes,

Earnings season has arrived, and it’s pulling no punches.

The ASX 200 slid below 9,000 this week as a brutal run of profit warnings rattled investors. Healthcare led the losses, dragged down by a historic collapse in Cochlear (more on that shortly), while banks and real estate also came under pressure. Financials are down nearly 5% over the past week after soft updates from Westpac, ANZ and Bank of Queensland. Healthcare tumbled 7.5%. The index is still up modestly for the year, but the gap from February’s record high near 9,202 is widening.

Overseas, the mood is no better. U.S.-Iran ceasefire talks have stalled again, with JD Vance’s planned trip to Pakistan put on hold before Trump extended the ceasefire “indefinitely.” Oil is back near US$100 a barrel. And the first wave of U.S. tech earnings has delivered a warning that the Middle East conflict is starting to show up in the numbers.

Welcome to what some analysts are calling 2026’s ‘Confession Season.’ Here is a summary of market movements this week.

The Kitchen is Closed: Tim Cooks His Last Batch of iPhones

After 15 years, the Tim Cook era at Apple is coming to an end.

Apple (NASDAQ:AAPL) announced on Monday that Cook will step down as CEO on August 31, with hardware engineering chief John Ternus taking over on September 1. Cook will transition to executive chairman, working with policymakers and supporting the handover.

It’s one of the biggest leadership changes in corporate history — and it comes at a tricky moment for a company worth US$4 trillion.

🍎 Meet the new chef

Ternus, 51, has spent almost his entire 25-year career at Apple. He joined the product design team in 2001 and was promoted to senior vice president of hardware engineering in 2021. He’s been involved in the development of the iPad, AirPods, and multiple generations of the iPhone, Mac and Apple Watch.

Cook described him as having “the mind of an engineer, the soul of an innovator, and the heart to lead with integrity and with honor.”

In short, Apple is once again putting a product person in charge.

🤖 The AI elephant in the room

The timing matters. Apple has been widely viewed as lagging behind Microsoft, Google and Meta in the AI race. Apple Intelligence has underwhelmed, and the next-generation Siri has been repeatedly delayed.

Warren Buffett, whose Berkshire Hathaway remains one of Apple’s largest shareholders, has trimmed his stake significantly over the past 18 months. For Australians with exposure to Apple via their superannuation, the company’s navigation of the AI transition remains a point of market interest.

📉 Market reaction

Apple shares fell 2.52% on the news. Not a disaster, but not a vote of confidence either. Investors are waiting to see whether Ternus can deliver the next breakthrough product — whether that’s a true AI assistant, foldable iPhone, or something we haven’t seen yet.

Cook’s final earnings call as CEO will be in August. Ternus’s first big test comes shortly after.

Cochlear’s Staggering Bad News (b)Ears

If you want a textbook example of how brutal earnings season can be, look no further than Cochlear (ASX:COH).

🦻 What happened

On Wednesday, the world’s largest cochlear implant maker slashed its FY26 underlying net profit guidance to $290–330 million, down from $435–460 million. That’s a cut of roughly 30% at the midpoint.

The market’s reaction was savage. Shares crashed 40.7% in a single session, closing at $99.58, wiping over $4 billion off the company’s market cap. It was the stock’s largest single-day decline on record and its lowest price in more than a decade.

🌏 Why it happened

Cochlear flagged five headwinds hitting at once. Softer demand for cochlear implants in developed markets, particularly the U.S. Hospital capacity constraints and industrial action limiting surgeries in Italy, Spain, the UK and Germany. Order cancellations in the Middle East. An accelerated restructuring charge. And a stronger Australian dollar creating roughly a $25 million earnings headwind.

Management also acknowledged that weak U.S. consumer sentiment is now affecting discretionary healthcare decisions. Market data following the announcement suggests that cochlear implants may be more sensitive to discretionary spending than previously estimated by some analysts.

📊 The bigger picture

Cochlear has historically traded at 40–50x earnings, justified by its near-monopoly position and long-term demographic tailwinds. With the stock trading at such a high multiple, the market left little room for a miss; consequently, the valuation saw a sharp correction once the new guidance hit the tape.

UBS and Morgan Stanley both slashed price targets, with UBS cutting from $302 to $109 and downgrading to Neutral. Shares have continued to drift lower since Wednesday’s plunge.

Cochlear isn’t alone. Analysts are warning that the 2026 Confession Season has only just begun, and more ASX downgrades could be coming as companies navigate the Middle East conflict and a rising AUD.

🔦 Some other things we’re shining the Spotlight on:

MICROSOFT’S $25B AUSTRALIAN SPENDING SPREE: Microsoft (NASDAQ:MSFT) announced its largest-ever Australian investment on Thursday, committing A$25 billion over three years to expand AI and cloud capacity. CEO Satya Nadella made the announcement alongside PM Albanese in Sydney, with plans to grow Microsoft’s local Azure footprint by more than 140% and upskill three million Australians by 2028.

TEMPLE & WEBSTER SHUFFLES THE DECK: Online furniture retailer Temple & Webster (ASX:TPW) announced co-founder Mark Coulter will transition to executive chair on 1 July, with former CMO Susie Sugden returning as CEO after five years at Love to Dream and Genesis Capital. Shares fell 8.2% on the news, with investors questioning the timing. The stock is now down 79% from its 52-week high.

SERVICELATER: NOW SINKS ON IRAN WAR WARNING: U.S. enterprise software giant ServiceNow (NYSE:NOW) beat Q1 expectations but cratered 14% after flagging that the Middle East conflict delayed several large deals. Subscription revenue grew 22% to US$3.67 billion, but management said growth would have been roughly 75 basis points higher without the headwind. It’s the first real sign that the Iran war is showing up in corporate earnings.

RIVIAN R2 HITS THE ROAD: EV maker Rivian (NASDAQ:RIVN) officially started production of its make-or-break R2 electric SUV at its Normal, Illinois plant on Wednesday — just five days after an EF-1 tornado tore the roof off part of the factory. The R2 launches at US$57,990 with a US$45,000 version to follow. Rivian expects to deliver 20,000 to 25,000 R2s by year end.

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