July 7, 1997: Apple CEO Gil Amelio officially steps down from his role, turning the company over to the returning Steve Jobs, who immediately begins making his presence felt.
If you’re looking to pinpoint a turning point when Apple began the transition from the ailing company it was in the first half of the 1990s to the powerhouse it is today, this is it!
Steve Jobs takes over as Apple’s interim CEO
Apple’s comeback didn’t start with the iMac, the iPod or the iPhone. It started when the battered company handed the keys back to the guy it once pushed out. On July 7, 1997, Steve Jobs effectively took control of Apple after CEO Gil Amelio’s departure, inheriting a company that had just suffered a staggering $1.6 billion loss.
Initially hailed as a positive hire, Amelio oversaw the worst period in Apple history, at least from a financial perspective. During his reign, Apple suffered a $1.6 billion loss that wiped out every bit of profit the company earned since fiscal 1991.
Jobs’ first moves were anything but cosmetic. He repriced employee stock options, reshaped Apple’s board and began dismantling the company he believed had lost its way. Apple’s legendary turnaround was officially underway.
Steve Jobs reprices Apple stock options
When Apple announced Amelio’s departure on July 7, 1997, Jobs became the company’s de facto leader. His first big move as interim CEO was repricing all employee stock options to $13.81. That’s the price Apple stock traded at as markets closed on July 7.
This boosted morale, since it demonstrated that Jobs had faith he could turn the company around. It also meant that employee stock options were no longer valueless.
Apple’s board of directors resisted the repricing move. Jobs urged them to resign if they vehemently disagreed with his position.
Before long, he had nearly replaced Apple’s entire board of directors. Jobs brought in Oracle founder Larry Ellison, ex-Intel and Chrysler CFO Jerry York and Intuit CEO Bill Campbell. The most notable departure was Mike Markkula, who had been involved with Apple since the very beginning. Apple announced the new board at August’s MacWorld event.
Jobs eventually dropped his interim “iCEO” label for good in 2000.
Luke Dormehl is a U.K.-based journalist and author, with a background working in documentary film for Channel 4 and the BBC. He is the author of The Apple Revolution and The Formula: How Algorithms Solve All Our Problems … and Create More, both published by Penguin/Random House. His tech writing has also appeared in Wired, Fast Company, Techmeme and other publications.
2 responses to “Today in Apple history: Steve Jobs starts Apple’s dramatic turnaround”
Good article, Luke. Made me come up with a thought: Maybe we need someone with a Jobs-like attitude to come in and simplify again. Don’t get me wrong… I admire all of Apple’s current products, at least conceptually. Their delivery, however, has been far from flawless: iTunes that goes off line or deletes music files, iMessage that fails to deliver messages and doesn’t play well with non-iOS phones, and now Apple wants to release an untested new file system on us….
Maybe we could go back to the days when things just frickin’ worked, and that may require a simplification of the products and services lines.
Apple’s product line has become a bit convoluted like the iPad line up that’s become baffling for anyone who isn’t an Apple follower.
Oh and for goodness sake, could they just fix up everything iCloud related, because it just sucks. There are so many little bugs that should never exist, like the fact that I don’t get Family Sharing notifications.
Tim Cook is a brilliant supply chain guy, but he certainly isn’t anything like the CEO that Jobs was.