World of Apple

Many will recall that this is not the first time that Apple Chief Operating Officer has stepped in while CEO Steve Jobs dealt with a medical condition.

Back in 2004 Cook ran the shop for just over one month while Steve Jobs recovered from surgery that removed a malignant tumour from his pancreas. At the time Apple’s stock also suffered in a similar way to how it has today dropping 2.3% on August 2, 2004 the day following Steve Jobs email from his hospital bed. By September 1, 2004 AAPL was back at $35.86 or a 10.9% gain since early August.

The differences between Apple now and Apple then are fairly stark, in July 2004 the company reported earnings of $61 million on sales of $2.014 billion. Apple had around $5 billion in the bank.

In Apple’s last quarterly statement (the next is due on January 21) the company announced $1.14 billion on sales of $7.9 billion, with nearly $25 billion in cash.

Tim Cook was given the title of Chief Operating Officer in 2005 and oversees Apple’s supply chains, sales, and support services as well as the company’s Mac division.

In 2006 the Wall Street Journal profiled Cook describing him as a “low-key operator” who fixed Apple’s serious manufacturing and inventory issues in the late 90’s. Cook is also said to have a reputation for detail.

Fortune also published an extensive profile of Cook in late 2008 after months of speculation about Jobs’ health, the article was aptly titled “The genius behind Steve”.

Image courtesy of Flickr user lemagit.

The New York Times is reporting that two people familiar with Steve Jobs health issues have confirmed that he is not suffering a reoccurrence of cancer.

According to the sources Steve Jobs is suffering from a condition which prevents his body from absorbing food, doctors have advised him to cut down on stress.

Steve Jobs announced via an email to employees yesterday that he will be taking a sideline at Apple until the end of June, in the mean time COO Tim Cook will take the reins.

Following yesterdays shock announcement that Steve Jobs will take the bench at Apple for six months until the end of June due to health issues and be temporarily replaced by current COO Tim Cook, Apple’s shares took a seven percent plunge but in early trading on Thursday made a slight recovery.

Many analysts and investors have weighed in on how they believe the news will affect Apple in 2009. Expectations towards the end of 2008 pointed towards Apple releasing a lower-end version of the iPhone dubbed “iPhone nano” and some kind of ultra-portable device, often described as a medium between the MacBook and iPhone.

“You can’t really dismiss the idea that if he would be gone from the company it would be a great loss, but there are a lot of innovative minds at Apple,” said Ted Parrish, portfolio manager at the Henssler Equity Fund in Georgia an owner of Apple stock.

“The company is in a great position, its product cycle is strong and we would buy Apple on weakness associated with this news.”

Analyst for Oppenheimer, Yair Reiner expects Jobs’ announcement to have “zero” impact on on Apple’s product plans for 2009 however the CEOs departure would affect future products still in the planning stages.

“Over the least ten years he has been the person who has filtered and synthesized the collective genius of all of Apple’s engineers … he has picked and chosen the best and ripest ideas and played a critical role in fitting those great concepts into great products” wrote Reiner in a report Thursday.

Kaufman Brothers analyst Shaw Wu added that although Jobs is a top innovator in history Apple has Jobs ideas institutionalised in its DNA.

“Apple is going to do well … there’s a lot of people at Apple who are responsible for its success” added Wu.

“What’s more important is the overall economy and people’s ability to pay $1,000 for an Apple notebook or pay $75 or $300 for an iPod or pay $200 for an iPhone,” said Mike Binger, fund manager at Thrivent Financial, an owner of Apple shares.

“That’s more pertinent to where the stock is going to go than how involved Steve is on a day-to-day basis.”

Gene Munster an analyst for Piper Jaffray added in a report on Wednesday evening that customers won’t stop buying products from Apple despite Jobs taking a sideline.

“We believe that during Jobs’ absence, Apple’s sales will be unaffected,” analyst Gene Munster told clients. “More importantly, we believe the pace of innovation will remain solid, driven by key product-minded executives,” he continued. “From an operational perspective, we expect [chief operating officer Tim] Cook to maintain the same standard of excellence that he demands as COO.”

Continuing on the subject of the “capable” Cook Munster said “while the iconic leadership of Steve Jobs cannot be fully replaced, we believe his core attributes as a CEO, operationally and with products, can be replicated,” adding “Cook provides the operational expertise for the company, which would serve him well as Apple’s CEO.”

Apple CEO Steve Jobs today sent the following email to all Apple employees:

Team,

I am sure all of you saw my letter last week sharing something very personal with the Apple community. Unfortunately, the curiosity over my personal health continues to be a distraction not only for me and my family, but everyone else at Apple as well. In addition, during the past week I have learned that my health-related issues are more complex than I originally thought.

In order to take myself out of the limelight and focus on my health, and to allow everyone at Apple to focus on delivering extraordinary products, I have decided to take a medical leave of absence until the end of June.

I have asked Tim Cook to be responsible for Apple’s day to day operations, and I know he and the rest of the executive management team will do a great job. As CEO, I plan to remain involved in major strategic decisions while I am out. Our board of directors fully supports this plan.

I look forward to seeing all of you this summer.

Steve

Steve Jobs has posted an open letter on Apple’s website explaining the issues he is having with his health and also giving reason for why he will not be at this years Macworld Expo.

Letter quoted in full:

Dear Apple Community,

Steve

Despite not yet being official, Businessweek’s Arik Hesseldahl spoke with VP at IDG World Expo Paul Kent who assured the journalist that Steve Jobs would speak at Macworld San Francisco next month. In addition noting that a joint announcement would be coming soon.

“We haven’t made the announcement yet. We usually do this in concert with Apple… I have no reason to believe that plans are not moving ahead,” for Jobs to speak.

It is being reported across the Mac web that an issue exists with the new MacBook Pro’s trackpad. The issues which has been picked up by PCPro.co.uk and AppleInsider seems to only affect the MacBook Pro and not the MacBook which also features the brand new button-less trackpad.

PCPro quotes this customer experience:

“Every 50 clicks, my trackpad will stop responding for five to clicks,” reports one poster. “Generally this will resolve itself given a few seconds, and is not directly dependent on number of times the trackpad is clicked while unresponsive.”

According to another blogger an email to Steve Jobs resulted in a call back from Apple. Despite the call back containing little substance it does confirm that Apple is aware of the issue.

Today the situation has been fortified further as reported by Mac Rumors an email coming from Steve Jobs’ email account reveals that a “software fix is coming soon”.

The latest email from Steve Jobs to a customer who complained that the new MacBook would be incompatible with HD camcorders now that it lacks FireWire reads:

Actually, all of the new HD camcorders of the past few years use USB 2.

Since the original email (pictured) the original sender has replied to which Steve Jobs replied again:

———- Forwarded message ———-
From: Steve Jobs
Date: Thu, Oct 16, 2008 at 4:04 PM
Subject: Re: Firewire RIP?
To: Xxxxx

-David

The Securities and Exchange Commission said Friday that it would be investigating false reports that Steve Jobs suffered a heart attack which affected the company’s stock price.

The report which first appeared on CNN’s iReport website was swiftly denied by Apple spokesperson Steve Dowling but caused Apple’s stock to hit a 52-week low of $94.

After an internet report claimed that Steve Jobs had suffered a heart attack, Apple has come out and denied the vicious rumours.

The report by a citizen journalist which appeared on CNN’s iReport detailed that Steve Jobs was rushed to an emergency room after suffering “a major heart attack.”

When Apple was asked for further details this morning Apple spokesperson Steve Dowling told journalists that “The story is not true.”