Apple said it is aiming to cut Tim Cook’s salary package by more than 40% by 2023, following the CEO’s request after criticism from shareholders.
Apple’s compensation committee decided to lower Cook’s total “target compensation” to $49 million, down from a target of $84 million a year ago, according to a regulatory filing Thursday.
Cook’s base salary remained unchanged at $3 million, with bonuses of up to $6 million. However, according to Apple, his stock compensation target will drop from his $75 million in 2022 to his $40 million this year.
The percentage of stock units granted to Cook in Apple’s performance-linked compensation package for 2023 increased from 50% the previous year, as Cook wanted incentives to more closely match future growth. It accounted for 75% of the total stock compensation.
Apple says Cook’s compensation package is within the CEO’s “80th and 90th percentile” when compared to its peers.
Cook’s net worth has ballooned to $1.7 billion in recent years, according to Forbes. This is largely due to his stock-based compensation as Apple stock soared. His actual total earnings in 2022 will bring him to $99.4 million and in 2021 he will reach $98.8 million, a 500% increase from his $14.8 million the year before.
A majority of shareholders (64%) gave their approval in an advisory vote on Apple’s executive compensation package at last year’s annual meeting, but the company said in a filing that “as our annual meeting of shareholders, It represents a significant year-on-year decline.” Say on Pay proposals have received much higher levels of shareholder support over the years. “
Apple said some shareholders who do not support Apple’s executive compensation package “consistently cited the size and structure of the 2021 and 2022 stock awards granted to Cook as the primary reason for their voting decisions.” mentioned,” he said.
But Apple said Cook, the former chief of operations who succeeded the late Steve Jobs as CEO in 2011, still has broad investor support.
“There was also overwhelming support for Mr. Cook’s extraordinary leadership and the unprecedented value he provided to shareholders.”
In submitting the compensation committee’s decision, the company said it “balanced Mr. Cook’s recommendations to adjust compensation in the light of shareholder feedback, Apple’s extraordinary performance, and feedback received.” .
The filing stated that Apple would make these determinations “before the beginning of each fiscal year,” and ended September 24, 2022.
Apple has had a difficult few months after the disruption at its factories in China. As a result, on November 6th, Apple issued a rare warning that iPhone production faces “significant” disruption before the holiday season. The company’s stock has fallen more than 20% in the past 12 months.
Analysts lowered earnings forecasts for the December quarter. This is Apple’s most profitable period. Current consensus expects earnings to fall short of his $124 billion he earned a year ago. A failure like this would interrupt a streak of 14 quarters of growth.
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