updated 05:40 pm EDT, Sun October 31, 2010
Retail VP builds empire of successful stores
Apple's senior vice-president in charge of retail operations, Ron Johnson, sold 150,000 shares of stock in the company last Thursday, according to SEC filings posted by Apple on Saturday. With a strike price of $11.06, and an average sell price of $306, the executive received a $44 million dollar windfall. Johnson is in charge of running Apple's retail empire, now encompassing 317 stores and still growing at a furious pace both in store openings and profitability, setting records all the more impressive in light of the recession-bound economy.
Johnson was originally recruited to Apple in January 2000 from Target, where he was vice president of merchandising. He pioneered the concept of the Apple retail outlets and the Genius Bar, notoriously having to "sell" CEO Steve Jobs on the concept. The stores have been an extraordinary success story, reaching $1 billion in sales within two years (shattering the previous record) and continuing to set high standards in both architectural design and profit-per-square-foot, an important measurement for retailers. The stores now account for $3.57 billion in revenue, up 74% from last year.
The stores are also widely credited with having helped Apple's image more more into the mainstream, maintaining a consistent average of 50 percent of buyers being new to the platform, and also leading Apple into new directions, such as de-emphasizing trade shows in favor of reaching new buyers where they already shopped. In harmony with a rich consumer-product line up and effective ad campaigns, the stores helped distinguish Apple as a brand with a distinct difference from its competitors -- many of whom have spent years in largely-fruitless efforts to copy the upscale style and "experience" of Apple retail stores.
Johnson has sold a large percentage of his holdings in Apple over the last three years, netting him a combined profit of $202 million. On Halloween 2007 he sold 700,000 shares with a strike price of $23.72 for an average of $185, resulting in a $112 million profit. In March of this year, Johnson -- along with many of Apple's executive team -- sold an additional 200,000 shares for an average of $229 per share, netting him over $45 million.
According to SEC filings, Johnson retains some 230,000 shares of Apple stock. Several other Apple executives recently sold some of their stock this month as well, most notably Senior VP of Hardware Bob Mansfield.