Steve Jobs’s decision to step down as Apple Inc.’s chief executive officer erased as much as $52 billion from the benchmark gauge for U.S. stocks, futures trading shows.
The September contract on the Standard & Poor’s 500 Index slumped up to 0.6 percent after Jobs released his statement at 6:34 p.m. in New York yesterday. The measure’s total market value was $9.34 trillion at the close of regular trading at 4 p.m., data compiled by Bloomberg show. Apple fell 5.1 percent.
Jobs, 56, who has battled cancer and had a liver transplant, presided over a 9,020 percent surge in the stock since July 29, 1997, the day before the San Francisco Chronicle broke the news that he would be named interim CEO. Over the same period, the shares grew in value to $348.7 billion from $2.08 billion. Apple briefly surpassed Exxon Mobil Corp. this month as the world’s most valuable company. Chief Operating Officer Tim Cook, 50, succeeded Jobs.
“The fortunes of Apple have been closely identified with Steve Jobs,” Matt McCormick, a money manager at Cincinnati- based Bahl & Gaynor Inc., which oversees $4 billion, said in a telephone interview. “When he is in, the stock outperforms. The stock will languish until Cook can reassure investors and demonstrate his value. It’s not the end for Apple, but the end of a chapter.”
Under Jobs, Apple’s equity value swelled after the company introduced devices that revolutionized the computer, mobile phone and digital music industries. His attention to detail and emphasis on easy-to-use products helped Apple repel competition from rivals as varied as Google Inc. and International Business Machines Corp.
‘Day Has Come’
“I have always said if there ever came a day when I could no longer meet my duties and expectations as Apple’s CEO, I would be the first to let you know,” Jobs said in a letter to the “Apple community” and the company’s board. “Unfortunately, that day has come.”
Apple shares fell 5.1 percent to $357.10 at 7:59 p.m. in New York yesterday, following the announcement. The drop erased $17.7 billion from the stock’s value, according to data compiled by Bloomberg. The stock dropped 4.1 percent to the equivalent of $360.59 as of 12:52 p.m. in Frankfurt.
Futures contracts on the S&P 500 expiring in September rose 0.2 percent to 1,174.40 at 11:53 a.m. in London.
Jobs’s medical absences haven’t hurt the company’s share price in the past. During his leave from August to October 2004, the shares jumped 26 percent, compared with a 0.6 increase in the S&P 500, data compiled by Bloomberg show. When he took time off from January to June 2009, Apple climbed 66 percent, compared with 10 percent for the index, the data show.
“He’s always going to be remembered, maybe for the next 100 years, as the greatest technology business leader of our time,” Steve Wozniak, who co-founded Apple with Jobs, said in an interview on Bloomberg television. “Company culture doesn’t change overnight. He’s got tens of thousands of employees. The quality of the products reflects how good they are, too.”
General Electric Co. lost $323 billion in market value since Nov. 27, 2000, when the company said Jeffrey Immelt would succeed Jack Welch as chairman and chief executive officer of the world’s biggest maker of jet engines, medical-imaging equipment and power-plant turbines.
“Losing a visionary is really hard,” said Brian Barish, Denver-based president of Cambiar Investors LLC, which oversees about $8 billion. “It’s sad but it’s not a total shock. The open-ended question is whether Apple is going to have the vision to continue to develop its market position. Sometimes companies lose their visionary and they continue to successfully do what they’ve done in the past, but any changes in the paradigm are harder.”
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