April 22, 2013
Sources Say Board of Directors May Be Seeking Replacement, but Reports Unconfirmed
According to Forbes, which cited Wall Street sources, Apple’s board of directors may secretly be looking for a replacement for Cook.
Although the search has not been confirmed, some investors say it is overdue, according to the report.
While Apple shares were at their highest under Cook’s leadership last September, they have since fallen to $390, nearly half of the record high of $702.
Apple’s lack of innovation in the past six months has also raised concerns with stockholders. Apple’s iPhone 5 and iPad Mini both came out last fall and no new products have been announced since.
Cook, who described 2012 as “an incredible year of innovation” during Apple’s annual meeting with shareholders in February, said Apple is working as hard as ever and “has some great stuff coming.”
One of the items could be the iWatch, the hotly anticipated and, as yet, still unconfirmed wearable computing device that is expected to hit the market late this year.
There have also been rumors of an iTV, sparked by comments Cook made during a December 2012 interview with NBC.
“When I go into my living room and turn on the TV, I feel like I have gone backwards in time by 20 to 30 years,” Cook told NBC. “It’s an area of intense interest. I can’t say more than that.”
A cheaper version of the iPhone is also a possibility.
The Apple rumor mill has been grinding since the beginning of the year that Apple plans to release a smaller version of the iPhone in a bid to take a good-sized chunk of the Smartphone market away from arch-rival Samsung.
Samsung Smartphone sales have been forecast to grow 35 percent this year, shooting from the 215 million sold last year to 290 million. Apple sales are predicted to grow by 33 percent to 180 million.
Dubbed the iPhone Mini by analysts, the device is said to be the company’s answer for those who want an Apple Smartphone but are loathe to pay the relatively high price to own a device.
Jefferies analyst Peter Misek has predicted a low-cost iPhone will launch this summer for $200 to $250 while Piper Jaffray analyst Gene Munster forecasted such a device would likely cost $149 to $199.
A report by Bloomberg in January, however, indicated the iPhone Mini could sell for as low as $99.
Meanwhile, sources told the Wall Street Journal that Apple, which has been considering the production of a cheaper device for years, has finally begun work on “a less expensive version of its flagship device.” The new iPhone could launch later this year, a source told WSJ.
According to the report, the cheaper phone may look like the current iPhone, but would be made with less-expensive materials.
One possibility, the report said, is Apple using a different shell made of polycarbonate plastic — a large departure from the aluminum used for the iPhone 5. A share of the other parts could be recycled from older iPhone models.
Cook has also been encouraging investors to look at the big picture rather than focusing on the five-month slide of Apple’s stock.
“I don’t like it either,” Cook said of the stock’s plunge from its record high of $705, but added the firm continues to be steadfast in its long-term strategy. That strategy, he said, will bring in revenue, although he did not elaborate further.
Cook’s heavy on the promises, light on the details approach, seemingly, is not winning him any fans among the shareholders.
Analysts, however, do not appear to share the same discontent.
Not one of the 37 analysts at major security firms following Apple have downgraded the iPhone maker’s stock to a “sell,” although some have downgraded it from “strong buy” to “moderate buy.”
Fortune magazine has suggested Forbes’ sources are anti-Apple, adding that Cook seems to still have the respect of analysts and board members alike.
If the rumors of a new CEO search are more than just the grumblings of a handful of dissatisfied investors, however, Cook could have a lot riding on Apple’s next round of quarterly results, due out tomorrow after the market closes.