Apple once again gave its founder and CEO a symbolic salary of US$1 for its fiscal year, which ended in September, according to a report filed Wednesday with the Securities and Exchange Commission. Jobs also earned US$1 in salary in 2000.
The company's revenue slid to US$5.4 billion in fiscal 2001, down 34 percent from the US$8 billion culled in 2000 and less than the US$6.1 billion reported in 1999. Earnings swung from a profit of US$786 million in 2000 to a net loss of US$25 million in 2001. Nearly all product segments and geographic markets declined in 2001.
However, Jobs' low salary isn't a reflection of Apple's tough year. Instead, it reflects a policy of giving the flamboyant founder novel performance awards.
In Apple's fiscal year 2000, for instance, the company decided to give Jobs a Gulfstream V jet worth US$43.5 million, as well as US$40.5 million to pay for the taxes and other costs associated with granting the plane. Apple's board of directors voted to award the plane to Jobs in December 1999, but it was only delivered in fiscal 2001 and thus wasn't counted in his compensation until then, according to the SEC filing.
Jobs co-founded Apple in the 1970s but left in 1985 after disagreements with the board. He returned in December 1996 when Apple, in a surprise move, purchased Next Software--another company founded by Jobs. Although he initially played a peripheral role, Jobs became Apple's interim CEO in the summer of 1997 when the company ousted then-CEO Gil Amelio. Jobs later became permanent CEO.
In fiscal 2000, Jobs received 20 million stock options, or more than 5 percent of the outstanding shares, at a split-adjusted price of US$43.56 a share. Not only was the exercise price US$3 lower than the average Apple option given to employees that year, but all 20 million shares (calculated pre-split) vested by July 2001--or more than twice as fast as normal Apple options. The exercise price of Jobs' options, though, exceeds the market value of Apple stock, which hovers in the low US$20s.
Although Jobs did not receive any additional stock options in fiscal 2001, other key Apple executives did. Each receiving one million options at an exercise price of US$16.81 were Fred Anderson, chief financial officer; Tim Cook, senior vice president of worldwide sales; Jon Rubenstein, senior vice president of hardware; and Avi Tevanian, senior vice president of software engineering. Each also received a salary in the range of US$400,000 to US$660,000.
Like other PC companies, Apple endured a tough year. Following double-digit growth in fiscal year 2000, the company saw double-digit declines in 2001. US sales, for instance, dropped 30 percent to US$3 billion in fiscal 2001. Sales in Japan dropped 47 percent to US$713 million, after rising 57 percent in fiscal year 2000. Sales of iMacs declined 45 percent, from US$2.2 billion to US$1.2 billion. Only the iBook, the company's consumer portable, saw sales rise and that was partly due to an overhaul of the line.
The future could also prove to be rocky. Earlier, Apple predicted that its newly opened retail stores would break even in the first fiscal quarter of 2002, which ends this month, and achieve a slight profit for the full fiscal year. Now the company says that the stores will see a small loss for the fiscal year, according to the SEC filing. Still, Apple plans to open more locations in fiscal 2002.
Direct sales over its Web site came to US$2 billion in fiscal 2001.
