Total Pageviews

Thursday, December 27, 2012

A Pay Cut for Tim Cook? Not Really

In 2012, Apple became the most highly valued public company in history and generated $156.5 billion in revenue - nearly 50 percent more than in 2011.

So how much did Timothy D. Cook, the company's chief executive, take home?

A relatively modest $4 million in pay, according to documents filed with the Securities and Exchange Commission on Thursday. The filing, made in advance of the company's annual shareholder meeting, revealed that Mr. Cook earned a salary of $1.36 million and received a cash bonus of $2.8 million.

That may look like a steep decline from the $378 million package that Mr. Cook was awarded in 2011, one of the la rgest on record, bolstered by a stock package that was worth $376.2 million at the time.

But the stock will vest over a 10-year period. Frank Gillett, an analyst with Forrester Research, said that this move was in line with Apple's overall strategy, from its product development plans to its long-term goals for the executive at the helm.

“If you want to create success for the company, you want to create it based on the long-term success of the company,” he said. “You put a big carrot on the horizon, about 10 years out, and go from there.”

Mr. Gillett also noted that although Mr. Cook did not receive any additional stock benefits this year, the board increased his salary to $1.4 million from $900,000. He also pointed out that for a period of time, the company's former chief executive and founder, Steven P. Jobs, earned a salary of just one dollar.

“If you were handing out gigantic nine-figure stock deals every year, it would send the wrong message to customers and shareholders,” he said.