Apple CEO Gets Slapped with 15% Pay Cut, Here’s Why It Won’t Hurt His Wallet
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Tim Cook had his best (and worst) payday yet in his history of working for Apple
While Apple earlier this week announced annual sales figures of an impressive $215.6 billion for the 2016 fiscal year, that number ultimately fell 3.7% short of the company’s target of $223.6 billion for the last 12-months ending September 30th, 2016. Unfortunately, the Silicon Valley tech-giant’s operating profit — its cash surplus, after all costs and expenses are accounted for, which is free to be reinvested or saved for future projects — also fell about $300 million short of its $60.3 billion target, according to a copy of Apple’s annual regulatory filing that was obtained by The Wall Street Journal.
Needless to say, Apple did not have the best 2016 — insofar as sales and revenue and the company’s bottom-line are pertinent, at least. But what does all of this “falling short of reaching targets” actually mean for the folks working up at One Infinite Loop? Well, not much for the salaried technicians, coders, and the programmers. But for the company’s top brass, including CEO, Tim Cook — well, I suppose you could say he just got slapped on the wrist — and handed a golden ticket — all at the same time.
Due to Apple’s “lackluster” performance last year, Tim Cook, for the first time since assuming his role at the helm of Apple, received only $8.75 million in gross compensation — while in 2015, for comparison, Cook was given a more generous $10.3 million. Likewise, so was the case for other top Apple executives, including CFO, Luca Maestri, who saw ten percent shaved off his usual, $25 million annual salary.
Perhaps its not all that surprising, though, to hear about Apple’s less-than-stellar sales performance this past year. After all, while the company’s iPhone business blossomed into a whopping 63% of Apple’s overall revenues, 2016 also saw iPhone sales drop — for the first time in years — amidst a myriad of hindrances, including basic market saturation in developed markets like the U.S., increased competition from lower-priced, higher-quality Android-makers in China, and even the fact that Cupertino has yet to benefit much from the goldmine that is the Indian market.
In any case, I don’t think Cook, in particular, is sweating too much over his pay cut. The executive who replaced Steve Jobs at the helm of Apple recently celebrated his 5th year in the role — and, as constituent with the terms of his bonus agreement, was awarded a stock and options package worth well over $100 million.
Does it seem fair to cut executive pay in the face of less-than-anticipated sales performance?
Let us know what you think in the comments!
