(Reuters) - Apple Inc's (
AAPL.O)
Chief Financial Officer Peter Oppenheimer will retire and hand the
reins to Luca Maestri in September, entrusting to the Italian-born
executive a cash pile the size of Vietnam's economy and the difficult
task of guiding Wall Street's expectations.
The 50-year-old born in Rome is taking over
with Apple at a crossroads. Investors continue to clamor for the company
to put its industry-leading $160 billion hoard to better use than just
parked overseas, while rivals Google (
GOOG.O) and Facebook (
FB.O) shell out tens of billions of dollars snapping up cutting-edge tech companies like Nest and WhatsApp.
Managing investors' outsized expectations may
become more difficult as Apple - facing slowing revenue growth and more
aggressive competition - dives deeper into lower-margin but
higher-growth emerging markets like China, where cheaper local players
Huawei and Xiaomi dominate.
"Maestri will be assuming this role at an
interesting time - when Apple is in the midst of launching more services
and likely needs to convince investors that it has more consistent
revenue streams in a commoditizing smart phone market," Barclays analyst
Ben Reitzes wrote on Tuesday.
"We know Maestri quite well and believe he
will support consistent plans for capital return and thoughtful,
achievable guidance."
Maestri, who has worked in countries from
Brazil to Thailand, is not expected to pursue radical changes to the
iPhone maker's capital return strategy.
Longer-term, the company is also under
increasing pressure to come up with the next big thing. Some investors
bet that Chief Executive Officer Tim Cook will finally unveil a
revolutionary new product this year, breaking a dry spell of several
years during which it stuck mainly to iterations of the iPhone and iPad.
Oppenheimer, 51, had been CFO since 2004 and
was the architect behind a $100 billion capital return program
established a year ago in response to demands the company do more with
its ballooning cash hoard.
He joined Apple from Xerox Corp (
XRX.N) in 2013. He spent 20 years at General Motors (
GM.N)
where he worked as CFO of several units including GM Europe. Before
joining Xerox, he was CFO of network equipment maker Nokia Siemens
Networks.
TAKING UP THE BATON
Over the past few quarters, Oppenheimer has
moved Apple, which for years routinely smashed investors' expectations,
toward more realistic financial targets and outlooks as the company
amassed size and expanded into new markets.
Its business has also grown rapidly beyond
mainly hardware sales and into areas such as software and digital
content. Now, Maestri assumes responsibility for outlining the
investment case for a company under an intense media and industry
spotlight.
"Managing Wall Street's expectations became an
exceptional challenge for Apple over the past couple of years," said
Morningstar analyst Brian Colello. "It's clear what drives Apple's
growth. The issue is managing such a large, scrutinized company."
"Now it's become more of a leveling-off (of expectations). And that will continue."
Apple's shares were up 0.7 percent at $531.24 in late trade.
Oppenheimer, who joined Apple in 1996, will
start handing over in June to Maestri. Named to the board of Goldman
Sachs Group Inc (
GS.N) on Monday, he said in Tuesday's statement he would use some of his free time to complete his pilot's license.
"When we were recruiting for a corporate controller, we met Luca and knew he would become Peter's successor," Cook said.
On Tuesday, he noted that Apple's revenue had risen to $171 billion from $8 billion during Oppenheimer's tenure as CFO.
Cook and other executives had said the company
intends to update shareholders and investors on their cash management
strategy around April.
The company's growing cash pile has been a
perennial source of discontent amongst investors, given much of it is
parked overseas without significant returns and the company has proven
conservative in pursuing acquisitions.
The company has said it will return $100
billion to shareholders by the end of 2015 through dividends and share
repurchases. In February, Apple said it had bought more than $40 billion
of its shares over the past 12 months, helping to satisfy activist Carl
Icahn and other investors, at least for now.
"Oppenheimer had a very successful run but
joined Apple at a time when the personal technology market was focused
exclusively on personal computers," said University of Notre Dame
visiting professor of marketing Brett Robinson, author of "Appletopia."
"Apple's hiring of Luca Maestri, who has broad
international experience, is consonant with Apple's strategy to expand
their global footprint."
Reuters