Investors sanguine as Apple's Jobs steps aside
SAN FRANCISCO/NEW YORK
SAN FRANCISCO/NEW YORK (Reuters) - Apple Inc's first day without Steve Jobs as chief executive looked awfully similar to most other days: its share price beat the broader stock market.
In announcing he could no longer fulfill his duties and would resign as chief executive, Jobs made headlines worldwide and raised questions about the future of a $350 billion company that revolutionized computing and consumer electronics.
One headline, in Brazil's O Globo newspaper, declared: "Steve Jobs created our world."
Investors took the shift in stride, expressing confidence in Apple's product pipeline, managers and newly appointed CEO Tim Cook, who promised the company would stay the course.
"Steve built a company and culture that is unlike any other in the world and we are going to stay true to that -- it is in our DNA," Cook, 50, wrote in a memo to staff.
Shares closed down less than 1 percent at $373.62 and outperformed the major stock indexes. Shares are up nearly 57 percent in the past year and remain a favorite of analysts even in the absence of Jobs. At least 13 brokerages maintained their stock price targets in research notes issued Thursday.
Often mentioned in the same breath as Henry Ford, Thomas Edison or Walt Disney, Jobs is credited with bringing Apple back from the brink of disaster. Since his return to Apple in 1996, after an absence of more than a decade, the company's stock price has climbed roughly 9,000 percent.
In recent years, Jobs' battle with pancreatic cancer has been of deep concern to Apple fans and investors. Jobs, 56, who has been on medical leave since January, will become chairman.
"Over the course of last year, investors have become more comfortable with the idea of life after Jobs," said Edward Jones analyst Bill Kreher. "I think it is encouraging that he will remain with the company as chairman, but the real story is that Tim Cook has emerged as a capable successor."
Cook, a former Compaq executive and an acknowledged master of supply-chain management, has taken over the helm in each of Jobs' three health-related absences, including his most recent one starting January 17.
His first big test could come as early as next month, when, according to a source, Apple is planning to introduce the iPhone 5 -- the sort of occasion that Jobs the showman could turn into a spectacle.
Cook, who was chief operating officer, is typically more low-key in public and around the office, according to those who have worked for him.
"Tim is an extremely analytical, methodical leader, data-driven, objective and unemotional," said one former Apple executive. "That is in contrast to his former boss."
Jobs briefly emerged from his leave in March to unveil the latest version of the iPad and later to attend a dinner hosted by President Barack Obama for technology leaders.
Yet his gaunt appearance sparked questions about how bad his illness was, and his ability to continue at Apple.
"I will say to investors: 'Don't panic and remain calm -- it's the right thing to do. Steve will be chairman and Cook is CEO," said BGC Financial analyst Colin Gillis.
Jobs did not give details on the state of his health. But oncologists who have not treated the Apple founder said he could be facing several problems tied to his rare form of pancreatic cancer and subsequent liver transplant.
Such problems include possible hormone imbalances or a recurrence of cancer that is harder to fight once the body has been weakened.
Jobs' privacy when it came to health matters often frustrated investors and employees. Even board members have confided to friends their concern that Jobs, in his quest for privacy, was not being forthcoming with directors about the true condition of his health.
"I think a lack of clarity of its succession plan in the past has been a distraction so we appreciate that this plan represents a smooth and orderly transition," Edward Jones' Kreher said.
As Apple chief, Jobs earned a reputation for commanding every aspect of operations -- from day-to-day running to broad strategic decisions. Even the front yard of his home in Palo Alto, California, is dotted with Apple trees.
In the process, he won widespread respect from rivals and drew comparisons to other iconic business leaders.
"As a competitor, Jobs has clearly raised the bar for all of us in the industry and helped reset what personal computing is," said Todd Bradley, executive vice president of Hewlett-Packard's Personal Systems Group.
"At the same time, Steven's board have built a transition plan and we will continue to view them as an aggressive competitor."
(Additional reporting by Bill Rigby, Alexei Oreskovic, Sarah McBride and Jim Christie in San Francisco; Edwin Chan, Lisa Richwine and Nichola Groom in Los Angeles; Peter Lauria, Liana B. Baker, Jennifer Saba and Tiffany Wu in New York; Brian Winter in Sao Paulo; Tarmo Virki in Helsinki; and Georgina Prodhan in London)
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