Apple CEO Steve Jobs Takes Medical Leave

Says Issues Surrounding His Hormone Imbalance Are "More Complex" Than He Thought

(CBS/AP)  Apple Inc. co-founder and Chief Executive Steve Jobs said Wednesday he is taking a medical leave until the end of June - just a week after the cancer survivor tried to assure investors and employees his recent weight loss was caused by an easily treatable hormone deficiency.

Apple's stock plunged 6 percent.

Jobs, 53, said in a letter last week that he would remain at Apple's helm despite the hormone problem, and that he had already begun a "relatively simple and straightforward" treatment. But in an e-mail to employees Wednesday, Jobs backtracked.

"During the past week I have learned that my health-related issues are more complex than I originally thought," he wrote.

Apple's shares have surged and crashed over the last year in step with rumors or news about the CEO's health and his gaunt appearance. While the top executive's health is an issue for investors in any company, at Apple the level of concern reaches fever pitch because Jobs has a hand in everything from ideas for new products to the way they're marketed.

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CBS News Science and Technology Correspondent Daniel Sieberg discussed Jobs' critical importance to Apple's mystique -- and bottom line and stock price -- on The Early Show. To see the video, click here.

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Jobs has run Apple for more than a decade and no CEO is considered more critical to the identity of his company, reports CBS News correspondent Anthony Mason. To investors, Steve Jobs is Apple - the wizard behind the stunning success of the iMac, the iPod and the iPhone.

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CNET Coverage of Apple

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"Envisioning Apple without Jobs is something that is going to be difficult to do," said CNET's Tom Krazit. "But it's important to emphasize that there are over 32,000 people who work for Apple now; this is not a small company like it was when he took over in 1997."

Last week, Jobs said his disclosure of his hormone problem was "more than I wanted to say, and all that I am going to say" about his health. It came on the eve of Macworld, the biggest Apple trade show of the year, and Jobs said he wanted everyone to relax and enjoy the show.

Even so, the limited amount of information in that announcement did little to soothe Wall Street's nerves. Medical experts not involved in Jobs' treatment said it was unclear what was behind his weight loss, but some specialists said Jobs' pancreas could be the problem, since the organ makes digestive enzymes that are key for nutrition.

Apple's history of keeping information about Jobs' health under wraps is only fueling the speculation. The company waited until after Jobs underwent surgery in 2004 to treat a very rare form of pancreatic cancer - an islet cell neuroendocrine tumor - before alerting investors. That type of cancer is easily cured if diagnosed early, unlike the deadlier and more common adenocarcinoma.

And last summer, Cupertino, Calif.-based Apple insisted Jobs' weight loss was due to a common bug, even as The New York Times cited anonymous sources who said Jobs had undergone "a surgical procedure" to address the problem.

"They'll tell you the least they can tell you," longtime industry analyst Roger Kay of Endpoint Technology Associates said after Jobs' disclosure Wednesday. "They're trying to have it both ways, to protect their guy's privacy and feelings and at the same time somehow signal the market."

Apple's chief operating officer, Tim Cook, will take over Jobs' responsibilities while he is on leave, though Jobs said he plans to remain involved in major strategic decisions while he is out.

Cook is seen as one of Jobs' most likely successors, along with Apple's top marketing executive, Philip Schiller. American Technology Research analyst Brian Marshall - who last week predicted Jobs would step down this year - said Wednesday's announcement tips the bets in Cook's favor.

"The company has been soft-signaling to the Street for a while now that Steve Jobs is not going to be CEO forever," he said. "This will be sort of a trial period for Cook to be chief executive."

Cook lacks Jobs' charisma and showmanship, but is seen as a solid pick otherwise.

"Tim Cook is a very experienced and highly regarded chief operating officer," said Calyon Securities analyst Shebly Seyrafi. "He's qualified."

After tumbling as low as $76.11 a share, Apple's shares slid $5.45, or 6.4 percent, to $79.88 in extended trading after Jobs announced his leave.

Wall Street analyst Gene Munster with Piper Jaffray said on CNBC that he still considers Apple a buying opportunity.

"No doubt that Apple is losing the greatest pitchman on earth, but people still want to buy Apple products," Munster said.

He added that the stock is grossly undervalued and presents a buying opportunity.

"Apple investors need to look at the big picture. They need to look at the new products, the balance sheet...this is a storm that will pass," said Munster, who noted Apple has a deep bench of talent.

The analyst pointed to Tim Cook, who will oversee Apple's daily operations during Jobs' absence.

"Tim Cook is a pretty unemotional person, but his ability to run a company is second to none," Munster said. "He is very capable of running the operations of the company."

Munster also noted that while investors may be "frustrated" with how Apple has handled the disclosures regarding Jobs' health, they should not be dissuaded from investing in the company.

[aggiekat2004]

Oh, and yes...by the time you add all the stuff to a PC to bring it up to Apple standards, it''s usually cheaper to buy the Mac. You can get a great desktop machine with everything built in for about $1200. It''s elegant, there''s ONE CABLE (power), and wireless keyboard and mouse.

Wanting to upgrade from your PC brick? The Mac Mini starts out at $599, and uses your existing monitor, keyboard, and mouse. Your TOASTER is bigger than the computer. And slots? We don''t need them. Everything is built in.

Trivia question...what company implemented USB as a standard interface for their computers? APPLE. Intel developed it and it sat on a shelf until Apple incorporated it into the iMac.

What company added CD drives STANDARD on their computers? APPLE. Nobody else wanted to take the risk.

Who developed digital video and added it to their operating system? You guessed it. Apple. Microsoft even stole Apple code to create Video for Windows.

You want innovation...walk into an Apple Store and feel the energy and people actually excited about their computers.

[aggiekat2004]

That''''s certainly true but you don''''t have to spend so much money for a Mac...you can always go the Linux route.

Posted by clathrate at 12:35 PM : Jan 15, 2009
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Yeah, but once you actually purchase a Mac, and FEEL the quality of the product, and the fact that it actually works, unlike Windows Vista...you "get it."

I have no desire to run Linux. I want an elegant interface on a piece of hardware that''s classy.

My 20" iMac (3 years old) is still powerful enough to run high-end graphics programs, and includes a built-in camera. When I bought it three years ago I didn''t even know what I''d need a camera or Bluetooth for! But because Apple ALWAYS over-delivers on hardware, they give me a growth path to do things I didn''t even know I wanted to do. And yes, I RUN WINDOWS XP ON IT.

And no viruses or spyware, at least on the Mac side. The Windows side can still get viruses!

And when I bought my MacBook Air, even the packaging made me feel "special."

I''ve owned several PCs running Windows, and had several issued by employers. They feel cheap, they break, and there is absolutely minimal integration between Windows and the hardware.

I''ll never buy a PC again.

[ibzjem]

That''''s certainly true but you don''''t have to spend so much money for a Mac...you can always go the Linux route.

Posted by clathrate at 12:35 PM : Jan 15, 2009

Sure, but you really do get a lot with a Mac. Speaking of Macbooks specifically. I''ve priced building a PC notebook by adding up all the hardware/software options that comes standard with a Mac and it''s not any cheaper. To me the Mac engineers have really thought this product through to the extent of the available and mature technology. I purchased a Mac last year so I may be a bit biased, but I''ve been a long time PC "power" user and feel justified.

[yongamerica]

Jobs is a marketing genius. Steve Wozniak is the computer genius. It was his designs that formed the core of Apple. It was Jobs marketing genius that brought the complicated geek toy computer into households. Together they made the computer an invaluable toy and tool. All this was done long before Bill Gates bought Microsoft''s first operating system, MS DOS.

Maybe by some chance the genius spark of the Woz could be allowed back into Apple at this point.

[brianp55]

I find it a bit incredulous that a guy with his wealth and access to the finest medical care would have allowed a trivial "hormone imbalance" to continue utreated. Sorry to say that the underlying illness appears to be something much more "substantial" and probably is not amenable to treatment.

[clathrate]

I''''m tired of Windows, it''''s over-inflated spaghetti code with it''''s unmanageable registry, over-head, and security holes.


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Posted by ibzjem

That''s certainly true but you don''t have to spend so much money for a Mac...you can always go the Linux route.

[liselle3]

Why do so many depraved persons feel the need to make ignorant comments here? Apparently, they lead unhappy
Posted by studio41

They do because they can. They don''t have to say it to the subject or the subject''s family face to face... This makes them feel they can say anything they want without risk of much of an intelligent argument or facing the hurt they''re words can cause. I also think they just do it for shock value. Or - the next theory is they are potential candidates for the Jerry Springer show.

[ibzjem]

- I am an Apple convert -

Posted by zoe-2009 at 09:12 AM : Jan 15, 2009

Me too!!!

I''m tired of Windows, it''s over-inflated spaghetti code with it''s unmanageable registry, over-head, and security holes.

[ibzjem]

Why do so many depraved persons feel the need to make ignorant comments here? Apparently, they lead unhappy lives.

Posted by studio41 at 01:57 AM : Jan 15, 2009

LOL!!! It''s a never ending story. They are called "cranks" or sometimes "deniers" depending on the subject at hand and their stance. There''s a whole psychology behind it. It''s good that you asked though. Maybe bringing this question up from time to time will make people think about it more.

[zoe-2009]

Jobs turn out to be impressive. He turned a failing company into multi-bilion dollars and products that have set pace for technologies - I am an Apple convert -