Feb. 28 (Bloomberg) -- Apple Inc. shareholders approved the company’s proposals and rejected those that the board opposed at its annual meeting, in a show of support for Chief Executive Officer Tim Cook.
Cook told stockholders at the event in Cupertino, California, that Apple is on the right track.
Revenue growth “is greater than any other technology company,” the CEO said, referring to the most recent quarter. “We made more money than any other technology company has ever made. Other than companies that drill oil for a living, I’m not sure that anyone has ever made more. We’re very proud of that.”
Cook is under pressure to reignite growth with new breakthrough products as the pace of sales slows for the iPhone and iPad. The world’s most valuable company, whose shares lagged behind the broader market last year, reported a drop in profit for the first time in more than a decade in its latest fiscal year.
Apple recently faced down activist investor Carl Icahn, who had called on the company to increase its share buybacks. Earlier this month, Icahn dropped a plan to force a vote over the issue, saying he was satisfied with statements by Cook that Apple had bought back $14 billion of its own shares in two weeks, bringing its repurchases to more than $40 billion in a year.
Institutional ownership of Apple shares has declined as funds question the company’s ability to increase revenue long term, Morgan Stanley said in a report this week. Apple’s 30 largest shareholders own a record low 30 percent of shares outstanding, down from a peak of 40 percent in 2009, according to the report.
At the meeting, Apple said it will have an update within 60 days on its cash policies. Cook declined to elaborate, saying the company is “in it for the long term.”
Apple has been exploring new products, people familiar with the plans have said. Those range from iPhones with bigger screens to a new wearable computer and payments system.
In the wake of Facebook Inc.’s agreement to purchase messaging application WhatsApp last week, Apple also said at the shareholder meeting that it sends more than 40 billion notifications a day.
Asked why Apple hadn’t introduced a radical new product, Cook said investors wouldn’t be concerned if they could see developments in the company’s engineering labs.
“Many companies sell futures,” he said, when an attendee asked why Apple had no version of Facebook CEO Mark Zuckerberg’s vision to connect every human to the Internet. “I’m not saying companies that do that are right or wrong. It’s just not who we are.”
Apple shares fell less than 1 percent to $526.24 at the close in New York.
At the meeting, Apple investors re-elected its board of directors, which includes Cook; Chairman Arthur Levinson, who also holds that title at Genentech Inc.; William Campbell, chairman of Intuit Inc.; Mickey Drexler, CEO of J. Crew Group Inc.; Bob Iger, CEO of Walt Disney Co.; Andrea Jung, former CEO of Avon Products Inc.; former Vice President Al Gore; and Ronald Sugar, former chairman and CEO of Northrop Grumman Corp.
Investors also backed an update to Apple’s policy for awarding stock to employees. The plan gives the company more shares to issue to its workers, mainly in “those positions deemed critical to the company’s future success, individuals whose personal performance makes them highly valuable to the company, and essential new hires,” Apple said in its proxy filing. Apple estimates the new plan will last through 2017.
Shareholders voted to approve a proposal backed by Apple to eliminate the board’s “blank check” authority to issue preferred stock. The proposal stems from last year, when the company fought hedge-fund manager David Einhorn’s effort to get a new class of preferred shares that paid a regular dividend.
Anne Simpson, director of corporate governance for the California Public Employees’ Retirement System, praised Apple’s support of majority voting for directors and for rolling back its ability to issue preferred stock without a shareholder vote. She said Apple is now “on the forefront of corporate governance.”
Investors also gave approval on an advisory vote on compensation that more closely ties Apple’s executive pay to stock performance. Apple, which backed the proposal, agreed to the changes at last year’s shareholder meeting.
Apple won investor support for its opposition to the creation of a board committee on human rights. Apple has said it is committed to social responsibility and doesn’t need a board panel to focus on the issue.
A proposal rejected by shareholders would have called on Apple to issue a report about its membership in trade associations or business organizations. The company’s board asked investors to oppose the plan.
A “spy lockout” proposal to promise greater protection of user data in light of the National Security Agency scandal was proposed and rejected during the meeting, earning less than 1 percent of shareholder votes.
Cook also spent time highlighting Apple’s efforts to improve the environment, support education for the underprivileged, and deal with humans rights abuses.
“I don’t think there’s another CEO that talks more about human rights than I do,” he said.
To contact the editor responsible for this story: Pui-Wing Tam at email@example.com