Apple Releases Financial Results, Discusses Options Scandal
Today Apple released both its tardy 10Q (for 2Q 2006) and 10K (for fiscal year 2006) reports to the SEC. Much of the attention of the press release was placed on the continuing Stock Options back-dating investigation.
According to the release, Apple found a total of $84 million in charges related to the case, which dates back to 1997, including $4 million in 2006 and $7 million in 2005. However, to put the issue in perspective, Apple's profits for 2005 and 2006 were $1 billion-plus each year, so the corrections represent less than 1% of Apple's profitability in those years.
In addition, Apple's board expressed confidence in CEO Steve Jobs, who was recently in headlines regarding some of the backdated options he received but never profited from.
Apple's stock has been traded heavily over the past few days, with the stock dipping as much as 6% before recovering on December 27th (Wednesday). As of this writing, Apple's stock is up over 5%.
According to the release, Apple found a total of $84 million in charges related to the case, which dates back to 1997, including $4 million in 2006 and $7 million in 2005. However, to put the issue in perspective, Apple's profits for 2005 and 2006 were $1 billion-plus each year, so the corrections represent less than 1% of Apple's profitability in those years.
In addition, Apple's board expressed confidence in CEO Steve Jobs, who was recently in headlines regarding some of the backdated options he received but never profited from.
The special committee, its independent counsel and forensic accountants have performed an exhaustive investigation of Apples stock option granting practices, in a joint statement said Al Gore, chair of the special committee, and Jerome York, chair of Apples Audit and Finance Committee. The board of directors is confident that the Company has corrected the problems that led to the restatement, and it has complete confidence in Steve Jobs and the senior management team.
Apple's stock has been traded heavily over the past few days, with the stock dipping as much as 6% before recovering on December 27th (Wednesday). As of this writing, Apple's stock is up over 5%.
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67 months ago
In addition, Apple's board expressed confidence in CEO Steve Jobs, who was recently in headlines regarding some of the backdated options he received but never profited from.
Of course he didn't profit from them - when the stock dropped sharply the options went underwater.They were exchanged, however, for restricted shares.
http://www.usatoday.com/money/industries/technology/2004-03-11-dirt-poor-jobs_x.htm
Posted 3/11/2004 11:59 AM
Apple CEO took $1 salary again in 2003
NEW YORK (Reuters) — Apple Computer Chief Executive Steven Jobs took a $1 salary in 2003, as he has since 1998, and received $74.75 million in restricted stock in exchange for his outstanding stock options in March 2003.
The Cupertino, California company did not pay Jobs, who is also a co-founder of the company, any new stock options or cash bonus in 2003. No other executive received stock options in 2003, Apple said.
Jobs began taking a $1 salary one year after he returned to Apple in 1997, aiming to turn around the company he helped found. But over the years, other compensation for Jobs has been criticized, such as stock options and a $90 million jet.
The grant of restricted stock, which Jobs received in exchange for cancellation of 27.5 million stock options, vests three years from the date of the grant. The move, which Apple disclosed a year ago, was part of the company's effort to reduce the percentage of issued stock options as a total of options and shares outstanding.
So, please try to convince me that "exchanging" the options for a stock grant is not "profiting" from them.
Or, probably more to the point, convince the judges in the class action shareholder lawsuits that will surely come that exchanging the options for a $75M "grant" isn't profiting.
And, don't forget that in March 2003 that grant was 10 million shares - at today's stock prices it's about $850M.
67 months ago
i feel like mr steve has so much money already that it's wouldnt be worth the time/trouble to imbezzle from apple.
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67 months ago
Good to see. Sad to see the craze this has been on the TV networks. Of all the pundits I watched, they all failed to mention that no one has commented on record. . . bah.
67 months ago
Putting aside the accounting issue, looks like a great Q2 for Apple! Healthy sales across markets for both the iPod and Mac lines. Although the same-three-month services sales related to the iPod seemed to be off. Hopefully that trend won't continue. Looks like they were down on desktops too, perhaps because of the transition, although they were up in Mac sales overall, so one could also interpret it as a healthy shift towards a richer mix of notebooks....
Looks good! Keep it coming.
Looks good! Keep it coming.
67 months ago
You say that as if its a bad thing. :p
It's not a bad thing, but Steve's dry cleaning expenses are crazy when they visit. It's so hard to get the stains out of Steve's cashmere turtleneck shirts.
67 months ago
I do not believe anyone at Apple would ever intentionally do anything against the rules for their own personal advantage. I believe they are all very honorable and honest people. Anything they may have done "wrong" was probably an innocent mistake.
67 months ago
I do not believe anyone at Apple would ever intentionally do anything against the rules for their own personal advantage. I believe they are all very honorable and honest people. Anything they may have done "wrong" was probably an innocent mistake.
Dont ever assume this of anyone! not even your own mother;)
Any who, glad this is over, lets move on...
67 months ago
It looks like the mess is over with this scandal. It made some great press headlines. I want to see additional headlines about Apple in a more positive light in the future.
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