Apple CEO Tim Cook’s salary has been cut by 15% as a result of the company missing its internal performance targets. As Apple follows a compensation plan that is based on an employee’s performance, almost all senior level executives at Apple have had their salaries but. Other senior executives did not face a cut as high as 15%, but it still was a modest cut of 9%.
The annual sales reported by Apple stood at $215.6 billion and the operating income of the company stood at $60 billion for the period ending in September 2016. Apple Inc has missed its operating income and internal revenue targets for the year 2016 by 0.5% and 3.7% respectively. Had they met their targets, Tim Cook would have taken home $10.3 million, but is now taking $8.75 million. Tim Cook’s basic salary actually did increase this year to $3 million. He also has a large amount of Apple Inc shares that remain untouched in this pay cut.
This is a major development for Apple as this is the first time that Apple has missed its revenue targets since the year 2009. Apple has grown steadily since its inception, with a few bumps along the road, but the company has delivered everytime investors and shareholders questioned its value. The year cannot be said to be a success or a failure for Apple.
Apple is however facing a challenge from Samsung as it faces a slowdown in the sales of iPhones in the last three quarters. Also, a lot of people feel that the latest iPhone does not have all the latest features that the customers were expecting. Despite the adverse sales reports, Apple’s stock has witnessed an increase in 10% of their share value in 2016 alone. Samsung may be facing a tough time due to the Galaxy Note 7 disaster, but it is sure to bounce back soon.