r/technology • u/geoxol • Jan 13 '23 • Bravo! 1 Helpful (Pro) 1

Apple CEO Tim Cook to take more than 40% pay cut Business

https://apnews.com/article/technology-apple-inc-tim-cook-business-d056553b10120c4a968b562cb7ece5d2
39.1k Upvotes

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9.7k

u/this-my-5th-account Jan 13 '23 • Masterpiece

He's still earning more in a year than any of us will ever see in a lifetime.

I'm sure he'll survive.

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u/Evilbred Jan 13 '23

He earns more in a month than most in a lifetime. His salary is only a small part of his compensation package.

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u/UltraSPARC Jan 13 '23

They restructured his compensation package too. They don’t want him to retire before 2026 so now his comp won’t mature until the end of 2025 instead of yearly. It was something like $119 million. Fun fact: he had a compensation package in 2015 that was $900 million if he held onto all the stock in todays dollars.

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u/BigGreen4 Jan 13 '23

According to the articles, this was his idea, after having listened to feedback from shareholders. He then put it to the shareholders to vote and they agreed, about 66% in favor of the new compensation package.

I just hope the funds saved will remain in employee compensation and be redirected to the employees. This would be a big step forward. (I understand that’s wishful thinking.)

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u/kent_eh Jan 13 '23

He then put it to the shareholders to vote and they agreed, about 66% in favor of the new compensation package.

I just hope the funds saved will remain in employee compensation and be redirected to the employees

If the shareholders wanted it, then they'll be the ones getting any extra money.

I would be shocked if they voted for anything other than their own personal enrichment.

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u/BigGreen4 Jan 13 '23 edited Jan 13 '23

Which is a good and valid point that CEO’s are not the one’s who control employee wages long-term. It’s the shareholders.

If Tim Cook gave all employees a 50% raise - everybody’s happy in the world. Until earnings come out, and the company (likely) underperforms. When a company underperforms, their shares tend to lose value. When the stock loses value, the shareholders lose money. The shareholders then pressure the board to fire the CEO (Tim Cook). New CEO moves in, cuts wages to get earnings back in line, and we’re back where we started.

Yet everyone points their fingers at the CEO.

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u/beavedaniels Jan 13 '23

Part of the CEOs job is to be the one who gets the finger pointed at them.

It's like the commissioners of the major sports leagues. They accept huge amounts of compensation in return for being the villain, so the real villains can continue doing fucked up shit behind closed doors.

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u/ChillyBearGrylls Jan 13 '23

They accept huge amounts of compensation in return for being the villain, so the real villains can continue doing fucked up shit behind closed doors

Amusingly, that also describes Ticketmaster et al - they would have no price setting ability if venues and performers didn't work with them. TM is the 'heel' in the story.

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u/beavedaniels Jan 13 '23

Yep! No shortage of people and organizations willing to trade the moral high ground for money haha

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u/FuujinSama Jan 13 '23

It's ridiculous, even. Venues have limited tickets. Clearly, there are enough people willing to buy the inflated """"scalper"""" prices. So why not set that as the initial sell price?

Instead they pretend concerts are still "affordable" and sell cheap tickets that they themselves immediately buy to sell again at the correct price. This in turn means the people that fail to buy the affordable tickets in time blame "scalpers" and "ticket master" instead of blaming the venues and artists for having the ridiculous but correct pricing.

In truth, it's all just an artifact of huge wealth inequality. If there's an event in demand with limited lotation (say 10,000 seats), the price of that event is what the 10,000 richest people that want to see the event can afford. In a world with huge wealth inequality that might be $500 or it might be $1000 whereas a reasonable price for the average worker would be $50 or lower.

Poor people will soon be unable to attend any sort of concert. That's just how it is. No money at all in filling a venue with poor people when there are enough rich people willing to pay. This wouldn't magically change if we added laws against scalpers or anything was made about ticketmaster. The only change would be venues and artists coming clean with the whole deal.

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u/mloofburrow Jan 14 '23

Except that Ticketmaster owns the venues and forces the artists to use them if they want to perform at said venues. So... no. Ticketmaster is still the asshole here.

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u/AndrewKemendo Jan 14 '23

It's almost as if, by supporting the villains, you become one too!

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u/Bakoro Jan 13 '23 edited Jan 14 '23

"Underperforms" the completely bullshit, high sloped infinite growth curve that shareholders expect, even during a recession.

The greedy psychopaths we generally call "shareholders" look at a perfectly healthy company, with steady returns, and a good long term strategy, and those shareholders will says it's "underperforming", because the company could also be sucking the blood from newborn children to maximize next quarter's profits.

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u/BigGreen4 Jan 13 '23

Those “greedy psychopaths” are generally your average, everyday citizen with a retirement plan. Or at least it’s their votes, proxied by their broker. Maybe everybody should stop allowing their brokers to vote for them, and instead tune in for the calls and/or votes?

I totally understand what you mean though. The world could be a much better place if people/corporations (that aren’t trying to advance the planet, human race, etc) could be content with matching last years’ record profit, vs upset they didn’t beat it by another 10%.

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u/Bakoro Jan 13 '23

Those “greedy psychopaths” are generally your average, everyday citizen with a retirement plan. Or at least it’s their votes, proxied by their broker.

Yeah, and brokers are likely greedy sociopaths.

Anyone who can look at a downward trending economy, or an industry devastated by some event, and still demand that they outperform the good times, is either a greedy idiot, or a greedy sociopath. That's all there is too it.

We've seen it time and time again.

The selfishness and short-sightedness is astounding.

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u/jobonki Jan 14 '23

Maybe don’t have brokers, direct register shares, then all votes are purposeful votes from informed individuals not psychopathic businesses

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u/group_XIII Jan 13 '23

Which means that the CEO that keeps the job is the one that is willing to exploit the workers. They certainly deserve to also be blamed.

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u/moustacheption Jan 13 '23

Right, employees need to start advocating to becoming shareholders via RSUs or other stock compensation so they can vote on shareholder proposals and actually have a say in the direction of their company.

Otherwise you’re really just a contractor with a shitty contract you can’t update every year.

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u/kbotc Jan 13 '23

Right, employees need to start advocating to becoming shareholders via RSUs or other stock compensation so they can vote on shareholder proposals and actually have a say in the direction of their company.

Apple gives very generous RSU grants, though I'm sure some of the people are disappointed that their $180k in RSUs have been losing money, but that's tech as a whole. My grants are in the toilet

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u/Windex17 Jan 13 '23

Wall Street unironically controls everything. All of the business decisions the largest companies in the world make are made to appease shareholders by law and the vast majority of policy pushed by politicians on both sides are made to appease their donors who are primarily from the financial sector. Money talks and Wall Street has all of it.

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u/ExceedingChunk Jan 13 '23

Shareholders sees a value in having a CEO like Tim tho. Not necessarily because he is many times more competent than any other CEO that could take significantly less salary, but because he's the face of Apple and him leaving would make the stock plummet.

Yes, they would obviously vote for themselves, but that would implicitly also vote for the company's value.

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u/oboshoe Jan 13 '23

That would be nice for Apple employees.

They are doing well though. Median comp is $143,000 a year at Apple.

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u/absentmindedjwc Jan 13 '23

They are doing well though. Median comp is $143,000 a year at Apple.

It is worth pointing out, as it seems to have confused people in another comment thread that mentioned this, that $143,000 is the median compensation for all Apple employees nationwide - corporate and retail.

A lot of people read this in that other chain and thought that Apple corporate employees averaged $143k, which is very much not a great salary in Cupertino California... the corporate employee median is likely quite a lot higher than $143k.

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u/korben2600 Jan 13 '23

That's not median pay. That's mean. So including the multi-million dollar salaries of the executives. The average pay for the "Client Advisor" title is $31,115.

Apple's median pay in 2018 was just $55,426.

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u/oboshoe Jan 13 '23

Yea I suppose if you include all the retail workers in, that does cut it down tremendously.

Nobody at Apple corporate makes less than $100k though and most are closer to $200k.

I don't feel like doing the math at Apple, but I've done it for other Fortune fifty companies. Usually if you eliminate the executive pay from the average or median, the number doesn't change significantly. While a single executive might earn as much as 200 employees, in a company with 40,000 employees their pay impact is quite diluted on the average and mean figures.

FWIW, if you took Tim Cooks entire comp package ($49m) and distributed it amongst the 40,000 employees, the employees would earn $1225 more a year.

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u/kbotc Jan 13 '23

Total comp for Apple's been insane the past couple of years. They recently gave off cycle RSU grants between $50k and $180k.

​

But this reduction in Cook's payment was agreed on a bit ago: https://www.marketwatch.com/story/apple-ceo-tim-cooks-compensation-rises-to-nearly-100-million-thanks-to-new-stock-award-11641508170

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They call them performance stock units.

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u/AstroPhysician Jan 13 '23

Nobody at Apple corporate makes less than $100k though and most are closer to $200k.

No, they're wayyyy above that

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u/Z23kG3Cn7f Jan 13 '23 edited Jan 13 '23

Apple is worth over $1TN in the bank.

It's their choice to not pay workers decently

Edit: I corrected it to worth, not cash. My bad.

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u/IAP-23I Jan 13 '23

Apple doesn’t have over a trillion in the bank, how does shit like this get upvotes

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u/big_sugi Jan 13 '23

$49 billion, according to the most recent report I saw.

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u/testedonsheep Jan 13 '23

it feels good to upvote misinformation that agrees with yourself.

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u/16semesters Jan 13 '23

And them saying Apple doesn't pay their workers well, when they pay above average for every sector of employee?!

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u/Qlinkenstein Jan 13 '23

how does shit like this get upvotes

The disinformation on Reddit is just a prevalent as it is on any other social network site. Some internet “genius” spews forth some BS and it gets repeated ad nauseam until it becomes “true” for some people. Rinse. Repeat.

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u/Zanos Jan 14 '23

Reddit is incredibly ignorant about basic economics when it gets in the way of making a point about a company.

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u/absentmindedjwc Jan 13 '23

Because people love hating on apple

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u/velders01 Jan 13 '23

This is reddit, they'd lynch Ms. Smith down the street running her flower store for "exploiting" workers.

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u/Cthulhuonpcin144p Jan 13 '23

They have 48billion in cash+short term investments. It’s nowhere close to a trillion$

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u/korben2600 Jan 13 '23

Yeah, they're probably conflating cash reserves with Apple's market cap which recently broke valuation records at $1 trillion (2018) and later $2 trillion (2020).

Apple's cash and bond reserves have been as high as $270 billion at its peak. Once Orange Julius passed his billionaire tax cuts in 2017, they took advantage of a tax loophole in the law which allowed corporations to repatriate their offshore cash back into the USA at a one-time rate of 15% which saved Apple roughly $47 billion in taxes.

Instead of adjusting employee compensation upwards, as Republicans said would happen, boosting the economy, most corporations used much of their windfall on stock buybacks and shareholder dividends. Apple used these methods to transfer ~$175 billion of the repatriated cash directly to shareholders.

As of Oct 2022, they currently hold $180B in cash and bonds. Apple keeps about 46% of its cash reserves in corporate bonds. Probably some of the largest cash reserves of any corporation on Earth.

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u/NotReallyChaucer Jan 13 '23

Apple also, as a result of the 2017 Tax package, gave each employee below a certain executive level $2500 of RSUs that vested over three years. I didn’t read of other companies who actually took the opportunity to benefit their employees. Yes, the amount may seem paltry, but it’s not nothing.

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u/Justtryme90 Jan 13 '23

Those dividends they paid out at least did go to a ton of peoples 401Ks as most US broad market index funds are heavily invested in apple.

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u/Cthulhuonpcin144p Jan 13 '23

Wow. Thanks for all the information, it’s still an astounding amount of $. From my quick look at figures the number was a bit smaller, but I’m guessing it’s because of the bonds they are using as holdings.

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u/SpongeBad Jan 13 '23

While the amount of cash on hand is insane, I get it when it comes to Apple. Any company that came that close to not existing because of cash flow issues would do everything in their power to prevent it from happening again.

If iPhone sales drop off a cliff, Apple will have a lot of cash to reinvent themselves (again).

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u/Pokerhobo Jan 13 '23

This is correct and easy to look up. Apple has been continuously doing stock buybacks. They've never had close to $1T in the bank.

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u/Cthulhuonpcin144p Jan 13 '23 edited Jan 13 '23

Yeah I think their peak cash on hand was like 100(nvm) billion. I’m shocked at just how big their buybacks have been, the more you know ig.

Edit: the real numbers around 200-250 billion

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u/Sexy_Mfer Jan 13 '23

It definitely peaked higher than that, think it was close to 250b when the rumors of them acquiring Netflix was floating. They ended up buying back tons of stock instead

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u/manatwork01 Jan 13 '23

They did hit 1T in market cap at one point maybe thats where they were confused? (looked it up they are at 2T now but thats if apple owned all their shares, they don't, and sole them all at peak pricing at once which wouldnt happen it would tank the stock.

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u/Fuzzy1450 Jan 13 '23

There’s so many finance illiterate people on Reddit who think a company’s net value is all in cash, or somehow easily spendable.

A company’s net value isn’t even a real number. It’s an evaluation. An estimate. If Jeff Bezos (net worth 118 bil) wanted to buy 118 billion dollars worth of people suffering, he’d have to sell everything he owns to pay for it. (Or he could open more Amazon warehouses)

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u/manatwork01 Jan 13 '23

As someone who is on a ton of personalfi and investing subreddits it's kinda crazy how few people understand any of these most basic concepts.

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u/SplitOak Jan 13 '23

Not to mention if Jeff Bezos started selling his shares to cash out the stock price would crash fast. And not only that, he has to get approval to sell off the stock; not like they are going to let him liquidate all of it. So many more restrictions that most people think of.

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u/Lessthanzerofucks Jan 13 '23

Their peak cash holdings were around $270 billion, then they vowed to spend most of that if they got a good deal on repatriating that cash from Ireland to the USA. That’s ONLY a quarter trillion.

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u/Dman5891 Jan 13 '23

Fun fact; if you spent a million dollars a day from the day Christ was born you would have spent less than 3/4 of a trillion dollars.

Pay your workers Timmy.

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u/GroverMcGillicutty Jan 13 '23

Apple is spending a hell of a lot more than a million a day in wages.

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u/Part_Timer_99Y4 Jan 13 '23

Good to know they’ve been around longer than Christ

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u/ImNotAWhaleBiologist Jan 14 '23

Yeah, didn’t they start in Eden?

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u/TaralasianThePraxic Jan 14 '23

This joke really deserves more credit

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u/Part_Timer_99Y4 Jan 14 '23

Fuck me that is a solid one liner

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u/[deleted] Jan 14 '23 edited Jan 14 '23

[deleted]

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u/MEME_RAIDER Jan 14 '23

In this moment I am euphoric. Not because of any phony God's blessing. But because I have been enlightened by my own intelligence.

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u/LifeHasLeft Jan 13 '23

Yep, they’ve got 160,000 employees, assuming the average salary is in the 100,000’s, they’re paying at least 40,000,000 a day in wages. Sure many Genius Bar employees will make less but there are also people making several hundred thousand dollars a year, or into the millions like Cook.

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u/Blazing1 Jan 13 '23

That's.... A lot less than I expected.

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u/Syntaire Jan 14 '23

At that rate it would take them about 68 years to spend their way through $1T.

Put another way Apple would have to spend about 20 average lifetimes worth of money every single day for most of a single average lifetime to burn through less than HALF of their current net worth.

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u/LifeHasLeft Jan 14 '23

You can’t spend net worth on wages. I think they could increase the low end of their wages too, but they don’t actually have $1T in the bank.

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u/metaStatic Jan 13 '23

What's the difference between a millionaire and a billionaire? A billion dollars.

Most people don't understand the scales we're talking about here

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u/Dragon_yum Jan 13 '23

Not that I disagree with you but Apple spends way more than 1 million a day.

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u/Dman5891 Jan 13 '23

I was making a point about how much a trillion dollars actually is, most people can't even imagine a number that big. Another way...in just over 11 days there are a million seconds. A trillion seconds takes over 31000 years !

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u/hrehbfthbrweer Jan 13 '23

This is always my favourite way of getting the point across:

https://mkorostoff.github.io/1-pixel-wealth/

Just shows how incomprehensibly wealthy these people and corporations are.

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u/[deleted] Jan 13 '23

[deleted]

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u/EvaUnit_03 Jan 13 '23

But christ was born more than 2000 years ago! He'd be 22 or something by your metric. Those 22 years make all the difference for the math.

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u/negativeyoda Jan 13 '23

Most scholars agree Jesus was born between 6-4BC so he'd be pushing 30

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u/Mczern Jan 13 '23

Yeah but Christ had nothing for the first 21 years of his life then got his shit together and pulled himself up by his boot straps and became a trillionaire over the following year. Look it up it's in the Bible.

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u/large_moist_loaf Jan 13 '23

Redditor moment

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u/ViennettaLurker Jan 13 '23

Its crazy that the difference your discussing might be, what, billions? And in a way it kinda doesn't matter at that point. Crazy to think of a million as change that could get lost in the couch.

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u/deedoedee Jan 13 '23 edited Jan 13 '23

Your source doesn't mention the Alexamenos graffito at all, along with other close-to-contemporary sources of proof that, at the very least, a person named Jesus who was worshiped existed.

If you want to lose the battle of minds, start with omitting your opponent's most easily-accepted facts.

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u/[deleted] Jan 13 '23

[deleted]

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u/keeelay Jan 13 '23

You’re no better than the Christians for this one homie

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u/mungalo9 Jan 13 '23

Jesus existed

No matter how euphoric you are today, you should at least be able to admit that.

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u/fb95dd7063 Jan 13 '23

reddit moment

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u/kosen13 Jan 13 '23

Le epic Reddit moment

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u/lilB0bbyTables Jan 13 '23

How about $1M a day since the start of the Common Era (C.E.) is what you’re looking for

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u/dank8844 Jan 13 '23

No they don’t. It’s not even close to that amount

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u/ttylyl Jan 13 '23

Apple has nowhere near 1 trillion in the bank lol. The value of the entire company is around 1 trillion. Which means if Apple wanted a trillion dollars they would have to somehow reclaim all the already sold shares and then sell 100% of their company to someone else, at which point they don’t get to chose what to do with the 1 trillion.

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u/RabidGuineaPig007 Jan 13 '23

The value of the entire company is around 1 trillion.

oh...that was Tesla once. US Tech valuation is a total joke.

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u/Draiko Jan 13 '23

In the bank? No.

Their cash on hand is around $50 Billion.

The entire company has a valuation of $1 Trillion which is very different.

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u/RabidGuineaPig007 Jan 13 '23

The entire company has a valuation of $1 Trillion which is very different.

For example, Tesla had a valuation of $1T, until they didn't. $700B go poof, imagine how much more if Elon wasn't a genius.

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u/Draiko Jan 13 '23

Elon isn't a genius. The world is just seeing more proof of that now.

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u/bluespringsbeer Jan 13 '23

What? Apple employees make bank.

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u/Luci_Noir Jan 13 '23

This is Reddit. Bosses, jobs, companies are bad and people like this will just make shit up and lie to support their bullshit. Antiwork maga

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u/techieman33 Jan 13 '23

Actual Apple employees make ok money. What about all the 3rd party employees that actually build their products though?

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u/VioletDaeva Jan 13 '23

Apple engineers certainly do, I know one who walked into a job straight from university on 6 figures and that was nearly 20 years ago.

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u/ExpensiveGiraffe Jan 13 '23

Engineer pay, at least software engineer pay, is (I hope this is the right word…) bimodal.

One group of workers, mostly F500 and smaller companies, pays less than employees at large tech companies. Both make good money, to be clear.

Apple is in that second group, but on the lower end of the payband. Someone talented enough to work at Apple could likely get a job at another tech company paying more.

Apple knows people really want to work at Apple, so they don’t have as much incentive to offer ultra-competitive pay.

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u/Purehappiness Jan 13 '23

You’re right if you don’t consider the long term performance of the stocks they provide.

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u/Badtrainwreck Jan 13 '23

They aren’t paid even remotely close to the profits they generate. Even if your someone who rubs yourself in baby oil while thinking about capitalism, they could pay their employees a ton more and their bottom line and investor confidence wouldn’t blink an eye.

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u/in_rainbows8 Jan 13 '23

They could pay their employees a ton more and their bottom line and investor confidence wouldn’t blink an eye.

This applies really to almost every corporation tbh. Walmart, the largest retailer worldwide, has some of the most employees on food stamps for example.

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u/AvatarAarow1 Jan 13 '23

Amazon too, and they all should pay their workers a lot better. The fact they can get away with paying such paltry wages while making record profit is insane

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u/ganjanoob Jan 13 '23

The company I work for assistant CEO said it’s a career year, we’re single handedly making the parent company so much money, most of the staff is making 16 per hour - 18 per hour while other companies under that parent company received raises to 22-24 per hour. They recommended to some employees trying unemployment/food stamps lol.

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u/tickleMyBigPoop Jan 13 '23 edited Jan 13 '23

They aren’t paid even remotely close to the profits they generate

Labor value theory is a meme nothing more.

Tesla was losing money in the 2010s does that mean worker pay should be cut?

What about biotech R&D workers, if there's a new biotech startup by default they're loosing shitloads of money....so should the workers be paid $0.00

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u/JHarbinger Jan 13 '23

They should obviously have to pay to work there, duh /s

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u/sirgenz Jan 14 '23

So who exactly generates the profits from, say, iPhones? Is it the engineers that design them, the overseas labor factory workers that produce them, the people mining the minerals, the people at the store selling them, the people making the iPhone commercials for ATT or the ones for Verizon or the ones for T-Mobile? I’m just wondering how you would allocate the profits to each group that generates them

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u/absentmindedjwc Jan 13 '23

They aren’t paid even remotely close to the profits they generate.

And what major company does pay anything remotely close to the profits they generate...?

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u/Zanos Jan 14 '23

Ironically, many apple employees have large portions of their compensations packages in company stock...

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u/absentmindedjwc Jan 14 '23

Just like Tim Cook. Iirc, dude makes like $4M in compensation. The rest is stock grants.

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u/PrimeIntellect Jan 13 '23

uh Apple workers are definitely gettin' paid

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u/BigSwedenMan Jan 13 '23

Market cap isn't the same thing as how much money they have in the bank

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u/testedonsheep Jan 13 '23

They also don't plan to have a layoff.

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u/Prodigy195 Jan 13 '23

They have a valuation over 1T but they don't have 1T in literal cash. Cash on hand is closer to 62B. Still an insane amount of money but a far cry from 1T in the bank.

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u/earthwormjim91 Jan 13 '23

They never had a trillion. They had around $200B. And not even that anymore. They’ve been burning their cash reserves down buying back stock and investing it other places, with a goal to have net zero cash reserves. They’re down to $48B now.

Also, Apple employees make pretty decent money. The Apple Store by me starts at $23 an hour and goes to $27 for just basic customer service/sales rep. Actual corporate devs make hundreds of thousands.

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u/oboshoe Jan 13 '23

You think that a median salary of $143,000 a year isn't decent?

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u/korben2600 Jan 13 '23

That's not median pay. That's mean. So including the multi-million dollar salaries of the executives. The average pay for the "Client Advisor" title is $31,115.

Apple's median pay in 2018 was just $55,426.

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u/pieter1234569 Jan 13 '23

Apple Pay’s very very very very decently. It’s just that the factories Apple employs don’t.

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u/BashBandit Jan 13 '23

Same with Amazon, a lot of things in their facilities don’t work properly/ they don’t hire proper people for positions where there should be specifically qualified workers/ and they skimp HARD on most amenities as far as I’m aware pertaining to safety. Sure they’re better than some, but with their resources there’s no reason the suck as much as they do

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u/Kamakazieee Jan 13 '23

Apple pays really well, maybe a touch lower than other top tech companies but it’s definitely still quite good…

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u/jimbo_hawkins Jan 13 '23

I don’t think the employees would notice if they did…

Cook’s total comp this year will be $49M after a 40% cut. This means he received total comp of approx $82M last year. Apple has 164,000 employees. If you split the savings across those employees, they would receive a one-time payment of $201. Even if you cut his total comp to $0, you could give $500 to each employee…

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u/tickleMyBigPoop Jan 13 '23 edited Jan 13 '23

His comp is paid for from the shareholders in the form of share dilution.

Most workers comp is paid for via revenue streams. Now their corporate workers aka software devs get RSUs, which are paid for via share dilution aka by the shareholders

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u/babybelly Jan 13 '23

I just hope the funds saved will remain in employee compensation and be redirected to the employees. This would be a big step forward. (I understand that’s wishful thinking.)

cries in chinese sweatshop worker

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u/EarendilStar Jan 13 '23

I just hope the funds saved will remain in employee compensation and be redirected to the employees.

Yes, I’m sure the employees will really appreciate the extra $6 a week.

For anyone that finds it hard to compare large numbers, just convert it into something familiar.

$99.4m (2022) - $49m (2023) = $50.4m extra cash.

$50.4m / 164,000 employees = $307 per person.

$307 / 52 = $5.90 a week.

So yes, CEOs should be paid less and employees more. But it’s important to look at the size of things to realize that sometimes such a gesture would be symbolic and mostly go unnoticed.

Put another way, imagine if the headline was: “CEO takes pay cut, pays employees extra $6 a week”. They’d be crucified.

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u/somegridplayer Jan 13 '23

I just hope the funds saved will remain in employee compensation and be redirected to the employees.

Stock buy backs.

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u/VirginiaMcCaskey Jan 13 '23

Stock buybacks are just tax preferred dividends. And they're great for employees who are paid partially with stock, which many apple folks are.

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u/ExceedingChunk Jan 13 '23

His compensation is crazy and he got $75m in stocks alone last year, but using "if he held his stocks for years, his compensation 10 years ago would be X" for any kind of compensation doesn't make sense.

The compensation is always just what the stock is worth at the time for any single stock that is publically available.

For example, if any other CEO that worked for any other company, got the same cash value in stocks as Tim, sold them and bought Apple stock for every single penny, nobody would suggest he got a $900m compensation package in 2015.

He's obviously filthy rich, but compensation doesn't work like that.

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u/LouieKablooie Jan 13 '23

That is too much money.

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u/peace_love17 Jan 13 '23

What is enough money?

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u/Unicycldev Jan 13 '23

5 million is plenty to live your best life.

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u/peace_love17 Jan 13 '23

Should no one be allowed to earn more than that? How did you arrive at that amount?

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u/Unicycldev Jan 13 '23

To answer your first question no. To answer you second question: the average rate of return of the S&P 500 for a 5 million dollar investment would yield $325,000 dollars per year pre tax. That’s enough.

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u/peace_love17 Jan 13 '23

That's a great living, way more than I make certainly, but why does income need a cap in general? The amount of people earning these headline grabbing salaries like Tim Cook are so few in number and the amount they earn is probably justified based on the economic growth the companies they oversee create (Apple is basically a small country at this point). It would probably cause more harm to poorer folks to cap Tim Cooks income than to just let Apple pay him his huge stack or whatever, at the end of the day it really doesn't affect me or you.

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u/Knogood Jan 13 '23

Ah yes, pay the person at the top the most, not the people doing the actual work.

Don't want to tax poor tim too much too eh? Incase one day your in his shoes, huh?

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u/Peetrrabbit Jan 13 '23

Awesome that you've decided that for all of us.

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u/roywarner Jan 13 '23

Put it to a vote and see what happens. You know how many people make more than 325k per year in the US? Less than 2%.

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u/rutabaga5 Jan 13 '23

Does it matter how they arrived at that specific amount? $5 million is definitely more than enough to live a great life and it is also definitely less than what he currently has. As for your second question yes, as long as there are still people living in abject poverty no one should be allowed to hoard money to such an excessive extent.

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u/Peetrrabbit Jan 13 '23

So.... you just force him to stop working? Or worse, you tell him he must keep working but can't keep any of the money from that work? There's a word for that last one... Either option is horrible. Don't think you've really thought your plan through here.

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u/dancin-weasel Jan 13 '23

About tree fiddy

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u/sassydodo Jan 13 '23 edited Jan 13 '23

That depends. Some people are overachievers and money is just a measurement of success, not some greedy goblin need.

I don't spend much money as there was time I was so poor I was rationing test strips for glucometer and asking for donations of infusion sets for my insulin pump, so I'm not used to throw away money, so now I'm just stacking cash or convert Russian rubles into USD in case of major crisis, I don't have a car and I live in one room apartment.

When owners of business ask if I'm happy with what I earn I tell that no, I'm not happy, because I get less than 1% of what I bring to them, but there is no number that would be satisfactory, like, I don't need $100k a month because I have something that requires $100k a months, I want $100k a month because I bring $500k a month in profit margins to them. I want all the money I can earn by being the best at what I'm doing.

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u/commitpushdrink Jan 13 '23

He’s one of extremely few non-founder tech billionaires

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u/rashaniquah Jan 13 '23

The craziest part is how he just became a billionaire not too long ago despite being the CEO of the largest company in the world

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u/usereddit Jan 13 '23

That’s a bit off comparing his 2015 stock package to todays stock price as it also could have gone to zero, and he’s the primary reason the stock increased in price.

Is it too much? Yeah. But, it still doesn’t make sense to calculate his 2015 pay based on todays price

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u/Kakarot_faps Jan 13 '23

The first rule about rich people is that 99% of them are rich not because of salary. There are over 9 million millionaires in America and almost all of them made it due to their house and/or the stock market making 40 times what they put in 40 years ago.

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u/BrazilianTerror Jan 13 '23

Tim Cook’s wealth comes from his salary though. Sure, technically it’s a bonus but it’s compensation for his work, how is that any different than a salary?

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u/Kakarot_faps Jan 13 '23

C suite executives at my company make much more from their bonus and stock/ownership than salary, I think it’s fair to say that’s true of cook

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u/SteelMarch Jan 13 '23

Probably cut it for more stock. It's cheap right now.

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u/happyscrappy Jan 13 '23

They did. I read the document.

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u/packetgeeknet Jan 13 '23

It’s down a bit, as are all stocks, but it’s hardly cheap. In December 2021, it had a peak of $178. It’s currently $132.

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u/VladTepesDraculea Jan 13 '23

Also, how much does it earn on dividends? Probably far more than his salary.

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u/ExceedingChunk Jan 13 '23

Yeah, he got $75m in stocks last year.

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u/TardOfAvon Jan 13 '23

He earns more in a year from AAPL dividends than many will make in a lifetime

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u/AstroPhysician Jan 13 '23

How I can tell you didn't read the article.

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u/Evilbred Jan 13 '23

Sir, this is reddit, no one reads articles here.

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u/Prodigy195 Jan 13 '23

CEOs or really any multi-millionaire still working really has to enjoy what they're doing.

If someone had $10M invested with a 3% yield they could retire on 25k month essentially indefinitely.

  • 3% of 10M = 300,000
  • 300k/ 12(months) = 25,000

Intentionally put a conservatively low yield, average for S&P 500 over the last ~30 years has been ~9% or 7% inflation adjusted so you'd likely get even more on average

Obviously the math is much more complicated but just trying to keep it simple.

I don't spend anywhere near 25k month and my wife, son and I live pretty comfortably already. With 25k a month of passive income we wouldn't be flying private jets or owning our own islands but we'd still be living extremely nicely. Could travel, stay at nice hotels, fly first class, hire guides to take you around other countries and just see all the cool shit this planet has to offer.

I just can't imagine the desire to keep working when that sort of life freedom is an option. Having to deal with Justice Department investigations, congressional hearings, economic ups/downs, shareholder meetings, harassment issues in tech, and probably a dozen other issues. I'd take my money, invest conservatively and enjoy our short time here on earth with family and friends.

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u/JHarbinger Jan 13 '23

I hear you, but some of us run our own businesses and really love that, AND do what you’re suggesting in terms of lifestyle.

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u/__Hello_my_name_is__ Jan 13 '23

He is a billionaire. He could earn exactly zero dollars and he would make more in interest than you ever will.

Hell, he could pay his current salary every year and he wouldn't even notice.

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u/Zefirus Jan 13 '23

A billionaire could have his money in the worst savings account making 1% per year (the financial equivalent of burying it all in the backyard) and he'd make more money off that 1 year than someone in the upper class would make in their entire career.

If you had a salary of $300,000 a year and worked for 30 years, a billionaire with that 1% of interest for 1 year would still have made more money than you.

People really don't understand how big a billion dollars is.

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u/__Hello_my_name_is__ Jan 13 '23

Yeah. I'm having fun arguing with people who try to convince me that they could spend a billion dollars just like that.

Nope, they couldn't. Not even on purpose.

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u/heckles Jan 14 '23

I mean I know a guy who accidentally spent $44B in less than a year.

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u/[deleted] Jan 13 '23

The median lifetime earnings is less than $4m.

He would earn that interest in a matter of a week or so.

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u/darkhoogan Jan 13 '23

Its even worse when you look at the whole planet and not just america. Worldwide the median yearly income is $1000-2000 (depending on methodology, I saw several conflicting figures).

Say you took the higher number and that you worked for 50 years. The median person will probably only earn $100,000 in their whole life.

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u/oboshoe Jan 13 '23

Sure.

But then why would he stay on at Apple?

The board wants him to stay until at least 2026.

(having said that. I would have retired long ago with the money he has made)

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u/Kershiser22 Jan 13 '23

(having said that. I would have retired long ago with the money he has made)

People who become CEO's generally don't have a lot of interests outside their work. It's harder to become a CEO when you check reddit at work all day. My boss was telling me how his wife gets mad at him because he's always talking to her about work, at all times of the day. The business is what is on his mind 90% of his waking hours.

That isn't the case for me, that's for sure.

(having said that. I'm not sure if I would retire if I had that kind of money. I'm afraid I'd be too lazy if I didn't have a job to go to every day.)

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u/oboshoe Jan 13 '23

Yea. Their work kinda is their life.

I earning a very nice living in tech. I have absolutely no complaints about pay. But I've also reached an equilibrium.

I don't desire to be top management. Yes they make much much more. But I'm not willing to trade away more of my personal life for more work life.

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u/NeoPossum Jan 13 '23

It's harder to become a CEO when you check reddit at work all day.

Musk seems to prefer shitposting for hours on Twitter to fixing his damned cars, so there's that.

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u/Kershiser22 Jan 13 '23

And it only cost him $200B!

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u/__Hello_my_name_is__ Jan 13 '23

At that level, nothing you do you do for money. You will never, ever be able to spend that much money even if you tried.

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u/BatchThompson Jan 13 '23

Bet. Wire it over and I'll see what kind of damage I can do.

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u/AlucardSX Jan 13 '23 edited Jan 13 '23

Be careful what you wish for. A century from now, as you lay on your deathbed in your giant mansion after a greatly prolonged life thanks to the very cutting edge of medical science, you will look back at your time spent jet-setting around the world, eating at the best restaurants, enjoying the company of the most beautiful women and lazing in the sun on deck of one of your three mega yachts, all without even making a dent into your vast fortune, and you will rue the day you ever took on this impossible challenge.

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u/BatchThompson Jan 13 '23

No time to sunbathe, I'm got enormous amounts of money to spend frivolously.

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u/datafox00 Jan 13 '23

This should have been a Twilight Zone episode, chilling...

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u/[deleted] Jan 13 '23 edited 28d ago

[removed] — view removed comment

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u/UnseenTardigrade Jan 13 '23

True, but that's actually not hard at all to beat if it's your goal. Buy a super yacht, hundred million dollar mansion, large private island, high end private jet, etc, and you'll get through a billion in no time. The key is making really big purchases, not trying to hit it by blowing 10k a day on clothes or something.

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u/[deleted] Jan 13 '23

[deleted]

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u/UnseenTardigrade Jan 13 '23

This is a much more reasonable approach. I was specifically trying to avoid pure investments from my example though because that makes it too easy.

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u/Occulense Jan 13 '23

Buy twitter and run it directly into the ground

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u/KopitarFan Jan 13 '23

Some of y'all never watched Brewster's Millions and it shows

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u/GigaCringeMods Jan 13 '23 edited Jan 29 '23

At that level, nothing you do you do for money.

But here is the problem; they still do. At certain point their goal is simply to get more. "Money" as a concept loses its inherent value and reason. To them it only starts being a number, and the only thing that matters is growing that number. That is why they keep hoarding more of it, that is why instead of relaxing and enjoying the rest of their life in complete financial freedom they still want to make more profit. Because the focus of their entire life has over time shifted to growing that number, forgetting the reason why they were after that number in the first place. It becomes tied heavily to their self-esteem, to the point where it becomes a representation of their self-worth.

The scale of the numbers when talking about millions or billions is hard for human mind to fathom. The best way to compare it is to think that a million seconds is 11 days. But a billion seconds is 31.5 years. The difference between a millionaire and a billionaire is... pretty much a billion dollars. Anyone that has crossed or come close to passing the billion dollar barrier is already neck-deep in the mental issue of needing more money. And it is a problem since all that extra money they are hoarding is out of the circulation, draining resources from the rest of society.

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u/Dazz316 Jan 13 '23

He's worth that much, he doesn't have that to spend.

He'll have more to spend than all of us combined but his back balance isn't 10 figures

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u/nevergotgold Jan 13 '23

I could easily burn through a billion in a week without much effort lol

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u/molrobocop Jan 13 '23

Challenge accepted.

I bet whatever the sum, I go the Andrew Carnegie route and get my name on all kinds shit. Blowing it at the institutional level. Not just stuff.

How much money does it take to establish a major university in this day and age? I bet a fucking shitload.

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u/this_barb Jan 13 '23

Because he was Steve Jobs' protege. Being at Apple isn't just a job to him, I suspect.

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u/ENrgStar Jan 13 '23

He isn’t even working for the money. He’s working because he likes it.

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u/NEONSN3K Jan 13 '23

The difference is. He’s taking a pay cut, in which all CEOs should. The pay difference is so disproportionate it’s no wonder the world is struggling when the workers who are the life blood of the economy aren’t being paid enough in lieu of the rising inflation.

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u/jandkas Jan 13 '23

Honestly good on him. He's taking a pay cut along with other execs so Apple doesn't have to lay off people...hopefully

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u/[deleted] Jan 13 '23

…which will help Apples long run profitability, increasing his wealth.

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u/jandkas Jan 13 '23

Yes that's the point.

But it's better than salesforce where the CEO just layed off a bunch of people + told current workers to work harder, and increased his wealth with the temporary surge in stock price.

Things aren't black or white, some things can be grey with lighter or darker shades.

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u/[deleted] Jan 13 '23

That’s not why he’s taking a cut in his compensation. It’s in part of a broad compensation restructuring at Apple. In fact, it’s likely it will increase his wealth as it will boost apple earnings - not because they are paying less to management, but because the purpose of the restructuring is to raise profits.

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u/jackityjack Jan 13 '23

The proportional boost to apple's earnings and thus stock price thus Tim Cook's wealth from cutting his comp doesn't even come close to breakeven lol

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u/[deleted] Jan 13 '23

His annual compensation is being cut by 40% which is 40m. He has probably over a billion in Apple stock or options. so all it would take is a 4% increase in share price over his time to equal that.

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u/FunctionBuilt Jan 13 '23

Dudes making average yearly salary in a week in just his salary from Apple. If you include his total compensation it’s more like 5x average US salary a day.

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u/HVACpro69 Jan 13 '23

I think we all knew that. What's the point of this comment?

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u/I_Am_Vladimir_Putin Jan 13 '23

Redditors will complain no matter what

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u/Krunkworx Jan 13 '23

Reddit sees anyone with lots of money as inherently evil and unworthy.

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u/UpsideDownHAM Jan 13 '23

Because Apple bad

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u/Cheeky_Star Jan 13 '23

With these deals there is always a compensation side like more stock options etc. it’s never that clean. Also not sure what he needs to take a paycut as apple has the cash on hand to continue paying him and not lay off anyone.

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u/kkehoe5 Jan 13 '23

What’s your point? You earn more in a year than the kid who assembled your smartphone will see in his lifetime.

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u/Strange_Ninja_9662 Jan 13 '23

It’s ok for someone to be rich. At least hes not so greedy that he feels he needs to keep earning more and more money like most other CEOs. $3 mil salary isn’t even that much money considering it’s the CEO of one of the largest companies on the planet.

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u/VirtualPoolBoy Jan 13 '23 edited Jan 13 '23

That’s the point. He’s cutting his own salary and shifting his compensation to the value of his company stock shares. Now instead of getting paid the same fortune even if the company does poorly, he will actually lose money. And while even that is mostly symbolic, it’s a strong show of leadership.

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u/spermcell Jan 13 '23

The guy earned it lol

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u/daern2 Jan 13 '23

Yes, a little known fact is that 60% of "fucking loads" is still "fucking loads"..

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u/eddie964 Jan 14 '23

He doesn't want to "earn." Income is taxable. He wants Apple stock, which he won't have to pay taxes on unless he sells it.

There is basically no reason for him to ever sell stock shares (and thus pay taxes). He can finance his lavish lifestyle by borrowing money against his stock holdings. Loans are not taxed.

He will still have to pay back the loans, of course. But probably not while he is still alive. He can live better than a Roman emperor on borrowed money that he won't have to repay until after he is dead. And he'll probably pay less in taxes than you do.

This is "Buy-Borrow-Die." It's how multi-billionaires cheat the system, and it explains why wealth keeps accumulating in the top fraction of 1% of the population, and why we can't pay for roads, education, and health care

It's a scam.

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u/ICPosse8 Jan 13 '23

Not to mention the monies he’s already earned. Any time I see these articles “CEO takes a pay cut” I immediately think about how they’ve already made enough and only now are they willing to take a little bit less.

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u/joseph_jojo_shabadoo Jan 13 '23

sure makes for a cute little headline though, and that's the point

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