Following missed revenue and profit goals for the year 2016, Apple has cut CEO Tim Cook’s pay by $1.5 million. According to Apple’s SEC filings, the company’s annual sales missed its target of $223.6bn (£181.6bn) by 3.7%, reaching only $215.6bn, while operating income came up 0.5% short at $60bn. As a result of this, Cook received a total payout of $8.75m in 2016, including salary and bonuses, which was down 15% from $10.3m in 2015 and also down on 2014’s $9.2m. Apple said in its filing:
Our 2016 performance with respect to net sales and operating income was 7.7% and 15.7% below our record-breaking 2015 levels; however, the 2016 payouts to our named executive officers were significantly less than the annual cash incentive payouts for 2015, reflecting strong pay-for-performance alignment.
Tim Cook wasn’t the only top executive that received a pay cut, other top leaders also received less compensation in 2016 as compared to 2015, although only by an average of 9.6%. Cook at 15% received the largest cut in percentage terms, other executives saw an average of 9.6% year-on-year reduction in annual targeted incentives.
Apple continue to struggle in it’s smartphone sales as smartphone innovation has appeared to be highly competitive, sales of iPhones declined in the last three quarters. Apple said it sold 45.5 million iPhones in its fiscal fourth quarter, which is 2.5 million fewer than 2015. The iPhone accounts for 63% of Apple’s annual revenue, however, the sales continue to decline as consumer buying habits are changing. 2017 is here, lets see how it turns out for the American multinational technology company.
Apple was founded by Steve Jobs, Steve Wozniak, and Ronald Wayne on April 1, 1976, to develop and sell personal computers. It was incorporated as Apple Computer, Inc. on January 3, 1977, and was renamed as Apple Inc. The American multinational technology company designs, develops, and sells consumer electronics, computer software, and online services. Its hardware products include the iPhone smartphone, the iPad tablet computer, the Mac personal computer, the iPod portable media player, and the Apple Watch smartwatch. Apple’s consumer software includes the OS X and iOS operating systems, the iTunes media player, the Safari web browser, and the iLife and iWork creativity and productivity suites. Its online services include the iTunes Store, the iOS App Store and Mac App Store, and iCloud. Apple is headquartered in Cupertino, California.