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January 05, 2009

IPhone -Apple's Jobs Suffering from Hormone Imbalance; No Plans to Step Down as CEO


Much speculation has been surrounding Apple CEO Steve Jobs (News - Alert) as he has been rapidly losing weight and elected not to present the keynote for MacWorld this year. Rumors have been flooding the industry concerning Jobs’ health, some even suggesting terminal conditions.

Jobs sought to put the rumors to rest as he issued a letter to those in the industry that attributed his rapid weight loss to a hormone imbalance that robbed him of essential proteins. Jobs called the treatment for his condition simple and straight forward. He plans to regain body mass by late spring and will remain CEO of Apple (News - Alert).

A CNBC report cited the Apple board’s support of Jobs: "Apple is very lucky to have Steve as its leader and CEO, and he deserves our complete and unwavering support during his recuperation," the board said, in a statement. "He most certainly has that from Apple and its Board."

In addition to putting rumors at rest concerning Jobs’ demise, the announcements from the CEO and the board led to an increase in the price of Apple shares. The stock showed an increase of more than 3 percent to $93.81.

Industry analysts believe these announcements will help Apple in the global market as the company has been struggling. Vijay Rakesh, an analyst at ThinkEquity shared with Reuters (News - Alert): "It's very positive that he came out and said this. I think it does put to rest all the speculation on his health and I think people will now start to focus on the business."

Financial Enhancement Group analyst, Adam Hartner, believes Jobs will bring some of the premium back to the price of Apple. "We added Apple a couple of months ago when it was in the mid-80s and at that point of time we felt the Steve Jobs' premium was already backed out of the stock price," Hartner said in the CNBC piece.
 
"So anything that says he's not in bad health is good news and this appears to say he's much better news than the market had anticipated so this upside can be significant."
 
In its announcement, the board clarified that Jobs will remain the company’s CEO, yet promises to communicate if Jobs chooses to step down. The board has made it clear that there is no evidence that this option is on the table.

What may have to take precedence, according to Larry Dignan, Editor in Chief of ZDNet, is the board’s succession plan in an effort to placate investors. Dignan shared his views in a recent blog, noting that while Apple may have faltered a bit in its handling of Jobs’ condition over the course of 2008, Wall Street is taking the news as a positive spin for now.
 

Susan J. Campbell is a contributing editor for TMCnet and has also written for eastbiz.com. To read more of Susan's articles, please visit her columnist page.

Edited by Tim Gray
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