permalink http://www.nytimes.com/2009/01/15/technology/companies/15apple.html?partner=permalink&exprod=permalink
Casting a pall over one of the world’s most closely watched companies, Steven P. Jobs, chief executive of Apple, said on Wednesday that he was taking a leave of absence because of health concerns.
Mr. Jobs wrote in a letter to Apple employees, released after the markets closed, that he had learned over the last week that his health problems were “more complex” than he originally thought. He said he planned to return to Apple at the end of June and in the meantime would hand day-to-day control of Apple over to Timothy D. Cook, its longtime chief operating officer.
Mr. Jobs, 53, wrote that curiosity about his health continued “to be a distraction not only for me and my family, but everyone else at Apple as well.” He said he would maintain the chief executive title and stay involved in major strategic decisions.
Mr. Jobs’s leave of absence is the latest twist in a story that has left the company’s shareholders, analysts and ardent fans exasperated and straining to divine any hidden meanings in the company’s vaguely worded communications.
In his letter, Mr. Jobs offered no new details about the cause of his health problems. In a letter last week that was meant to calm fears about his condition, he said a “hormone imbalance” was robbing his body of proteins and causing him to lose weight. Mr. Jobs recovered from pancreatic cancer after surgery in 2004, but has appeared unusually gaunt at recent appearances.
Two people who are familiar with Mr. Jobs’s current medical treatment said he was not suffering from a recurrence of cancer, but a condition that was preventing his body from absorbing food. Doctors have also advised him to cut down on stress, which may be making the problem worse, these people said.
An Apple spokesman, Steve Dowling, said the company had no comment beyond Mr. Jobs’s letter.
Apple shares dropped sharply in after-hours trading after the release of the letter, losing $6.03, or 7.1 percent, to $79.30. The stock fell 2.71 percent in regular trading amid a broad market slump.
Charles Wolf, an analyst at Needham & Company who follows Apple, said the stock market would probably fear the worst.
“It is reasonable to expect, given the history of Steve’s illness, that the market is probably going to assume that he is not going to return to Apple,” Mr. Wolf said.
In June, when Mr. Jobs appeared strikingly thin at a company conference for programmers, an Apple spokeswoman said he was recovering from a “common bug.” Soon afterward, Mr. Jobs acknowledged to The New York Times that he was suffering from digestive difficulties related to an operation he had as part of his cancer treatment.
Then last week, Mr. Jobs sought to calm speculation about his withdrawal from his regular keynote speech at the annual Macworld conference by acknowledging he had a “hormone imbalance.”
“The letter last week pretty much tried to reassure people that his health condition was extremely minor, but obviously it is more serious than first thought,” Ryan Jacob, founder of the Jacob Internet Fund, which owns a stake in Apple and is based in Los Angeles, said. “It’s disturbing.”
As news trickles from Apple about Mr. Jobs’s health, some shareholders and analysts have expressed frustration.
A spokesman for the Securities and Exchange Commission, John J. Nester, declined to comment on Apple’s situation. But he said that in general, while there were no specific requirements for companies to disclose the health of their officers or directors, companies needed to assess whether health problems could have a material impact on results.
For most companies, such information is not crucial because they are not as closely associated with one person. But Apple may be an exception. Since he helped found Apple in 1976, and particularly since he returned in 1997 after a decade-long absence, Mr. Jobs has been inextricablylinked to the company and its brand.
Over the last eight years, he has, seemingly single-handedly, powered Apple back to the forefront of the technology industry. Apple has sold 180 million iPod music players, and in the last 18 months, it has sold more than 20 million units of its iPhone.
But Mr. Jobs does not run Apple alone, and now at least one of his deputies will have a moment in the sun. Mr. Cook joined Apple in 1998 from the computer maker Compaq and is responsible for the company’s manufacturing and sales operations.
“I don’t think we know enough about Tim since he has never really been in the limelight,” said Toni Sacconaghi, an analyst at Sanford C. Bernstein & Company. “What we can say is Apple has a complicated business model with enormous seasonality. But it has been exceptionally well run across a number of dimensions for a number of years. I think a lot of that credit goes to Tim.”
By all accounts, Mr. Cook does not have the long-term vision or showmanship of Mr. Jobs, who appears capable of peering around corners into the future of technology, and can whip crowds into a frenzy merely by taking something new out of his pocket.
That is why analysts and shareholders saw so much portent in Mr. Jobs’s 170-word letter.
“These are times where you reflect about what Steve Jobs means for the company,” said Gene Munster, an analyst at Piper Jaffray. “At the end of the day, investors need to come to grips with the reality of a post-Steve Jobs world. This is the most urgent wake-up call they have had.”
