This Big Time Executive Is Betting $100 Million On His Success
It'd be more than fair to say that Apple has been in a little bit of trouble lately, certainly for their standards. After the price of their stock hit a high of $702.10 per share last September, it has suffered a steep decline to the tune of hundreds, hitting a low of $390.53 on April 13.
The unveiling of iOS7 hasn't given Apple much of a boost either — their stock is dipping under $400 as we, er, type — while one financial expert says they're losing employees to the other giants of the tech world.
“Lower Stock price is causing Apple to continue to lose employees to Google, LinkedIn. FaceBook and HP,” analyst Trip Chowdhry told the Los Angeles Times. “Employee morale at Apple is low.”
Clearly, everything isn't all roses and sunshine at the company that has revolutionized the way we listen to music. Shareholders are concerned and a few whispers of doubt are circulating. Some could see it as a sign that Apple is stumbling without the legendary Steve Jobs, the old CEO. The new one, Tim Cook, saw it as a perfect opportunity for a proverbial and defiant beating of the chest.
Apple's man in charge is essentially betting $130 million that the tech giant will not suffer a decline in upcoming years, which equals a third of his stock-based compensation.
The rules to his wager are simple, if Apple, Inc. performs in the middle third of the S&P 500, Cook will have to give up a portion of his stock-based compensation that would amount to $65 million today, according to Fox Business reporter Steve Tobak. If it performs in the bottom third amongst companies in that group, he will have to give up the full $130 million.
It's a straightforward idea. If Apple isn't making the money it should, he won't be getting money he shouldn't.
Cook's voluntary wager comes after Apple had already announced that it would begin to implement performance based metrics to match the stock-based compensation that its executives get. But since the CEO had been appointed in 2011, his payout would not have been subject to new rules. He could sell his stock in Apple for a profit no matter what happened, regardless if the company had done terribly.
He has willingly signed up to lead by example and as Tobak indicated, in a world that has seen big-time companies go down the drain while executives were still able to cash out, Cook's “bet” is a pretty good gesture.
Photo credit: WENN
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