Apple stock drops after Steve Jobs resigns as chief executive

August 25, 2011

Apple stock mostly recovered its early morning losses on Thursday afternoon, a sign that investors were feeling less nervous about the tech giant’s footing after its visionary chief executive announced that he is scaling back his role at the company.

Jobs, 56, announced Wednesday that he is stepping down after 14 years as Apple’s chief executive, though he will continue as the company’s chairman. Apple has named former chief operating officer Tim Cook, who has been leading the company during Jobs’s sick leave, as its new chief executive.

By market close, Apple stock was down 0.7 percent, priced at $373.72 per share. The tech-heavy Nasdaq composite index, however, had continued to fall and was down 2 percent at closing bell.

The upswing for Apple showed that investors were beginning to recover from the bad news on Jobs, who has been suffering from pancreatic cancer for the last six years and had a liver transplant about two years ago. In morning trading the company had dropped as much as 3 percent, to $370.63 per share.

Jobs, who co-founded Apple at age 21 and is so closely identified with the company that his health has had a clear effect on Apple stock in the past, said Wednesday that he could “no longer meet my duties and expectations” as Apple’s chief.

When Jobs announced his latest medical leave in January, shares fell nearly 4 percent in morning trading. But shares have risen rapidly over the past year, with Apple briefly surpassing Exxon Mobil in value this month.

Cook joined Apple in 1998 and is credited with getting the company out of the manufacturing business and streamlining its supply lines. He has been at Apple’s helm before, taking over for Jobs each time the famous face of Apple has gone on medical leave.

Shares gained about 70 percent the first time Cook took over day-to-day operations at Apple in 2009, showing that he has built some confidence with investors, Bloomberg reported.

Hayley Tsukayama covers consumer technology for The Washington Post.
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