According to an official press release from Apple Inc., the company’s principal and top executives, including Chief Executive Officer Tim Cook, didn’t achieve their payment goals as there was a decrease in Apple’s annual revenues.
Apple experienced its first revenue fall since 2001, and the immediate consequence was a payment drop for its chief executives, the company reported on Friday. Apple stated that its annual sales fell about 4 percent, meaning that their initial objective of achieving $223.6 billion only got to $215.6 billion. Its operative income also presented a decrease, only that in this case it was considerably lower, with a 0.5 percent fall of their initial goal of $60 billion.
One possible explanation for this issue is that the newest iPhone versions have not inspired automatic upgrades. Also, China is developing cheaper smartphone models, and several countries seem to be saturated.
“Overall, our 2016 performance with respect to net sales and operating income was 7.7 percent and 15.7 percent 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,” Apple stated in their official SEC filing published Friday.
How much is Apple executives’ payment?
Apple’s top five executives received $22.8 million each in 2016. This payment includes the normal salary of $2.8 million plus a $20 million bonus that comes from the division of the annual awards between the principal head directors. These numbers mean that each executive only received 89.5 percent of the income they hoped to achieve at the beginning of the last year.
Although the head of Apple, Tim Cook, registered an annual salary rise of $1 million, his overall income also fell from $10.28 million to $8.25 million. This includes a $3 million salary and a $5.37 award cash bonus. However, this does not include the $135 million worth stock actions that Cook possesses since 2011.
Those stock shares that Cook received are not the only ones that he has in his possession. Last year, he received $65 million worth of shares in a promotion award. Also, he has received several compensations in 2011 and 2013, and alongside the shares that are tied to the CEO job, Cook currently has over $350 million worth of shares.
One notable fact is that there is one top executive that does not receive equal compensations when comparing with other head directors. Vice presidents Angela Ahrendts, Eddy Cue, Luca Maestri, Dan Riccio and Bruce Sewell, all are tied to stock revenues and returns.
However, Chief Design Officer Jony Ive is not included within Apple’s compensation disclosures. Ive is the responsible for many Apple famous devices like the iMac, iPhone, and iPod.
To this date, Apple’s executives have not responded to press calls, Bloomberg reported, as the tech world waits for an official declaration regarding the company’s “bad” year and how executives are negatively affected by it.
Source: Bloomberg