Apple CEO Tim Cook Set to Reap Nearly $100 Million in Vesting Stock This Quarter

[DakotaGuy]

I don't think anyone deserves that much money. Now matter how good of a job they do, or what they do. It's simply too much for one person.

Of course he does. If anything considering how well Apple is doing they should pay him more. Imagine the value he is returning to the shareholders? If the business was failing I could see a pay cut, but when it is doing very well the CEO should receive excellent compensation. This is capitalism at it's finest. Do a good job and get paid well for it.

 

[bpfesq]

Honestly, the only stock grant that i find objectionable is the 1,000,000 shares. Giving the guy $400 Million bucks in shares, plus everything else, regardless of performance is unbelievable. That is a rediculous amout of money that comes right out of the pockets of the shareholders.

 

[slrandall]

Honestly, the only stock grant that i find objectionable is the 1,000,000 shares. Giving the guy $400 Million bucks in shares, plus everything else, regardless of performance is unbelievable. That is a rediculous amout of money that comes right out of the pockets of the shareholders.

... Do you know what an iPhone is? They sell pretty well.

 

[TallManNY]

Just so I am clear, you are saying there are 100,000 people in America that could run the world's most valuable company?

I think his point is that with the right training and experience and put in the same job there are plenty of people just as smart, diligent and organized as Cook. I suspect that is true statement, but the assumptions aren't really fair. Where could those 100,000 people get the training and experience that Cook has? How could they prove to the Apple Board that they have the same or better skills than Cook? Since they can't do either, they really aren't competition for Cook. But I think the general point is true on some sort of theoretical level. The same could not be said, for example about an elite basketball player like Lebron James. We know that there aren't thousands of people out there with his size and speed, so we know he cannot easily be replaced. But CEOs, yes it seems their pay is a little high in comparison to what they seem to bring to the table.

But who knows, perhaps Cook has some special set of skills that are less common than 0.1%. I think Jobs had skills like that.

 

[cvaldes]

Honestly, the only stock grant that i find objectionable is the 1,000,000 shares. Giving the guy $400 Million bucks in shares, plus everything else, regardless of performance is unbelievable. That is a rediculous amout of money that comes right out of the pockets of the shareholders.

The shareholders implicitly approve of the board's decision to hand out these sort of compensation offers.

Remember that the primary function of a publicly traded company is increasing shareholder value. Steve Jobs and the rest of the senior management team has executed for many consecutive quarters.

If you -- as a shareholder -- do not agree with the board's compensation offers, you are free to withhold your vote in re-electing any/all of the directors at the next annual meeting.

 

[paul4339]

Honestly, the only stock grant that i find objectionable is the 1,000,000 shares. Giving the guy $400 Million bucks in shares, plus everything else, regardless of performance is unbelievable. That is a rediculous amout of money that comes right out of the pockets of the shareholders.

$400 M over ten years... roughly $40 mil per year ... if (under condition) he stays the long haul.

It may sound like alot but consider this:

1) what happens if Apple offered him less, say $25 mil per year in options, and he says, uh, no thanks, I think I'll join Google.

2) let's assume Tim is best person for the job, and they can find someone else that's 90% as good for at a lower cost... what's the implication of that 10% performance decrease on AAPL and overall shareholder value. AAPL is a $300B+ company that is making profit $1B every 10 days (and growing).

They are paying relatively a bit more each year, to ensure that $300B cash cow performs optimally.

.

 

[bpfesq]

... Do you know what an iPhone is? They sell pretty well.

What does that have to do with $415MM of share dilution?

 

[TallManNY]

If you -- as a shareholder -- do not agree with the board's compensation offers, you are free to withhold your vote in re-electing any/all of the directors at the next annual meeting.

We can also bitch about this on the internet or we can vote Democrat and hope that taxes on the uber-rich (income over $1 million per year) can be raised.

There are many things we can do. But generally speaking the trend is for CEOs to garner greater and greater percentages of compensation paid by companies. No one has a real solution about what to do about this, but a lot of people think there is some sort of unfairness in this process.

 

[153098]

IMO he deserves it - he's made notable change for the good over the last few months.

I dont think any one person "deserves" that kind of money but congratulations to him. We'd all love to be in his position.

 

[phillipduran]

I don't think anyone deserves that much money. Now matter how good of a job they do, or what they do. It's simply too much for one person.

I'm glad I don't live in a country where people like you get to decide how much money people deserve.

Tim's money might go towards a home, a yacht, some cars. Perhaps some private planes. Who knows.

What I know is when he buys something, hes helping the construction worker, the landscaper, the carpenter, the aircraft mechanic, the car mechanic, the salesperson and on and on. You should realize his wad'o'cash is likely to be spent in part helping the rest of us contribute to our bottom line. Success anywhere by an American company or person should be lauded by Americans and not looked as too much money as I hear too often.

 

[PeterQVenkman]

Not many CEOs deserve their bonuses. This guy does.

give me a better iOS with widgets and more customization AND a new iPhone with real 4G functionality and a bigger screen and he can have all the millions he wants.

They can keep 4g off my phone until the batteries last longer or the devices drain less power! Yikes.

 

[HishamAkhtar]

So has Mandella... but I don't recall him being compensated with the equivalent of the average lifetime earnings of 100 Americans for three months of work >_>

Pretty sure he had to work at Apple for a while before being in a position to become CEO after Steve.

And apples and oranges my man...

 

[cvaldes]

I think his point is that with the right training and experience and put in the same job there are plenty of people just as smart, diligent and organized as Cook. I suspect that is true statement, but the assumptions aren't really fair. Where could those 100,000 people get the training and experience that Cook has? How could they prove to the Apple Board that they have the same or better skills than Cook? Since they can't do either, they really aren't competition for Cook. But I think the general point is true on some sort of theoretical level. The same could not be said, for example about an elite basketball player like Lebron James. We know that there aren't thousands of people out there with his size and speed, so we know he cannot easily be replaced. But CEOs, yes it seems their pay is a little high in comparison to what they seem to bring to the table.

But who knows, perhaps Cook has some special set of skills that are less common than 0.1%. I think Jobs had skills like that.

You show the Apple board of directors that you're Apple CEO material by A.) being CEO of another company (e.g., the other 499 CEOs of Fortune 500 companies), or B.) working your way up the ranks to end up being one of the top five executives in the company.

Remember, Tim Cook was personally selected by Steve Jobs to be interim CEO twice and the board approved. Likely, the Apple board has already singled out an interim CEO should something happen to Tim (illness, accident, departure).

My big question is why aren't the vast majority of the other 499 CEOs of Fortune 500 companies increasing shareholder value as much as Tim Cook has done for Apple?

Tim Cook can talk the talk, but he is also walking the walk.

 

[153098]

Do a good job and get paid well for it.

Just stop with that nonsense. Plenty people do a "good job" but are they getting well paid for it?

 

[kingtj]

Obviously, you hear this a lot .... but ....

I have to ask.... what, then, is the limit of how much money someone should be able to make, before reaching that point you speak of where it's simply "too much for one person"?

I think sometimes people lose sight of the fact that throughout history, certain lucky individuals have earned FAR more than they would ever need, or could even spend if they tried, on goods/services for themselves. What usually happens is they hand a considerable sum of money down to the next generation, and/or give a big chunk away to charitable causes.

As they say, "You can't take it with you." -- so in the big picture, why be so concerned that someone else amassed so much wealth? It's not like because Tim Cook has XX million dollars, that money must come directly out of what YOU were supposed to earn, since he's sitting on so much and there's no more to be circulated.

I don't think anyone deserves that much money. Now matter how good of a job they do, or what they do. It's simply too much for one person.

 

[Hmac]

Good for him.

 

[HyperX13]

Capitalism is awesome!!!

 

[uknowimright]

and I'm sure many of you would say Steve Ballmer doesn't deserve the money he gets

 

[longofest]

So, damn. When the multi-state lotteries reset (megamillions, powerball), they reset to around $20 million. People buy lotto tickets for a one in a million chance to win.

This guy is getting $100 million, and it's only one of his paydays.

I mean, just the scale of the thing... Damn.

 

[kingtj]

Making it political now, are we?

Don't forget, we collectively DID vote Democrat 4 years ago, and look what we've got right now? Yeah, that solved all SORTS of problems for us, didn't it?

How about we vote for a guy who will do sensible things like NOT perpetuating wars in the Middle East, spending money we can't afford to spend? Maybe a president who won't keep pushing "environmentally Green" mandates that do nothing but further damage the economy, too? (Yeah, let's ban incandescent lightbulbs! That helps make sure the last U.S. factory employing people to make them is taken away and we buy ALL our lighting from countries like China. Hazardous mercury in every CFL is just another bonus of that grand plan.)

We can also bitch about this on the internet or we can vote Democrat and hope that taxes on the uber-rich (income over $1 million per year) can be raised.

There are many things we can do. But generally speaking the trend is for CEOs to garner greater and greater percentages of compensation paid by companies. No one has a real solution about what to do about this, but a lot of people think there is some sort of unfairness in this process.

 

[ramuman]

Just stop with that nonsense. Plenty people do a "good job" but are they getting well paid for it?

That's an idiotic comment. Plenty of people don't run Apple. There's an element of special. Just because the average hard working Joe (plumber/construction worker/doctor/insert your pick) is good at their jobs doesn't mean there are people that do extraordinary jobs.

I'd list heading Apple or being senior management there as requiring being exactly that - extraordinary. Their pay package actually rewards past performance and loyalty into the future. I'm pretty sure they're not merely good. Content for a company that embodies the what's right about innovation at a time when America can really use it is absurd to me.

Creating wealth by definition is not a zero-sum game. You don't lose out because Cook makes that money. And this $500 million is for about 15 total years of service.

 

[kingtj]

re: Ballmer

Actually, probably not -- but I won't fault the guy for taking it!

IMO, Ballmer isn't the guy Microsoft needs at the helm to be successful. But obviously, he had a long-standing relationship with Bill Gates and he's the guy that was chosen for the job.

He still has a few good chances to redeem himself and Microsoft though. Mobile smartphones are a HUGE seller right now and by most counts, the Windows Phone take on them is a pretty good, solid offering. Microsoft's poor track record and history on mobile devices (Windows CE? Ick!!) is the main thing dragging them down.

They probably need to address the corporate side of smartphone needs/wants too. I think Windows Phone is too heavily consumer-focused, and they need to leverage it as a better alternative to, say, Blackberry phones, for business, to help get it in the door.

and I'm sure many of you would say Steve Ballmer doesn't deserve the money he gets

 

[cvaldes]

and I'm sure many of you would say Steve Ballmer doesn't deserve the money he gets

Ballmer has not increased shareholder value in a manner expected of a Microsoft CEO.

Microsoft 5-year stock performance vs. Nasdaq index (Source: Yahoo! Finance)

Note that the Microsoft board of directors has withheld some compensation from Ballmer, specifically citing his lack of execution in the mobile industry.

Ballmer was a great hatchet man for Bill Gates, but he clearly is not as successful in increasing shareholder value as his former boss.

 

[bpfesq]

The shareholders implicitly approve of the board's decision to hand out these sort of compensation offers.

Remember that the primary function of a publicly traded company is increasing shareholder value. Steve Jobs and the rest of the senior management team has executed for many consecutive quarters.

If you -- as a shareholder -- do not agree with the board's compensation offers, you are free to withhold your vote in re-electing any/all of the directors at the next annual meeting.

I'm well aware of the corporate governance at issue here. First, shareholders don't "implicitly approve" the board decisions. Rather, generally speaking, shareholders delegate their power to control the day to day operations, except for those matters expressly reserved under the governance documents (i.e. articles of incorporation/bylaws/etc).

Clearly the management team has executed over the previous years, but this stock grant isn't supposed to reflect prior performance. It is for his service as CEO--and as a CEO, he hasn't done anything yet. Sure, he MAY end up earning this grant (as I believe he earned those grants that vest soon), but he is unproven at the helm as CEO. He should have reveived OPTIONS with a strike price at the current stock price. His compensation should be tied to performance of the stock, especially if no dividends are made.

There is a major problem in the corporate world. Board members are elected by the institutional shareholders (not the small unit owners) who all "swim in the same pool". It's an old boys/girls club and they all appoint each other to various boards, set enormous, ever-rising compensation levels and they win regardless of whether the company succeeds. Meanwhile the incomes of those they set for those working for them are all under downward pressure, benefits are reduced, jobs outsourced, etc. In 1978, the average CEO to average employee pay was 35 to 1. Now? 475 to 1. Sorry, I'm all for rewarding success and am pro-capitalist, but greed has taken over.

 

[CrackedButter]

Forget the money, I'd like to know what Tim thinks of Rick Santorum's comments equating gay sex with beastiality. I hate that guy (Rick) and I'm not even gay.

That would be a MacRumours scoop for sure.