APPLE INC., DEF 14A filed on 1/11/2024
Proxy Statement (definitive)
v3.23.4
Cover
12 Months Ended
Sep. 30, 2023
Cover [Abstract]  
Document Type DEF 14A
Entity Registrant Name Apple Inc.
Entity Central Index Key 0000320193
Amendment Flag false
v3.23.4
Pay vs Performance Disclosure - USD ($)
12 Months Ended
Sep. 30, 2023
Sep. 24, 2022
Sep. 25, 2021
Pay vs Performance Disclosure [Table]      
Pay vs Performance [Table Text Block]

Pay versus Performance

 

The information below is provided pursuant to the SEC pay versus performance disclosure requirements set forth in Item 402(v) of SEC Regulation S-K (the “Pay Versus Performance Rule”), which requires companies to disclose certain information about the relationship between performance and the compensation of named executive officers.  

 

               Value of Initial Fixed $100
Investment Based On:
      
Fiscal
Year(a)
  Summary
Compensation
Table Total for
Mr. Cook($)(b)
  Compensation
Actually Paid to
Mr. Cook($)(c)
  Average Summary
Compensation
Table Total for
Other NEOs($)(d)
  Average
Compensation
Actually Paid to
Other NEOs($)(e)
  Total
Shareholder
Return($)(f)
  Peer Group
Total
Shareholder
Return($)(g)
  Net Income
($M)(h)
  Net Sales
($M)(i)
2023  63,209,845  106,643,588  26,943,956  41,980,664  155.24  116.88  96,995  383,285
2022  99,420,097  128,833,021  27,150,293  41,564,946  135.59  92.09  99,803  394,328
2021  98,734,394  311,845,801  26,987,631  75,307,922  131.69  136.57  94,680  365,817

 

(1) The dollar amounts in column (b) represent the compensation reported for Mr. Cook for each corresponding year in the “Total” column of the “Summary Compensation Table – 2023, 2022, and 2021” on page 62 of this Proxy Statement.

 

 

(2) The dollar amounts in columns (c) and (e) represent the amount of “Compensation Actually Paid” (otherwise known as CAP), as computed in accordance with SEC rules. Compensation Actually Paid does not represent cash and/or equity value realized or paid to Apple’s NEOs but rather is a value calculated under applicable SEC rules. The following table details how Compensation Actually Paid is determined:

 

     2023  2022  2021
     Mr. Cook ($)  Average for
Other
NEO ($)
  Mr. Cook ($)  Average for
Other
NEO($)
  Mr. Cook ($)  Average for
Other
NEO ($)
  Summary Compensation Table (“SCT”) Total  63,209,845  26,943,956  99,420,097  27,150,293  98,734,394  26,987,631
  Grant Date Fair Value of Stock Awards from SCT  (46,970,283)  (22,323,641)  (82,994,164)  (22,132,015)  (82,347,835)  (21,959,620)
  Fair Value of Equity Awards Granted in the Year and Unvested as of Year End  53,968,355  26,781,593  96,725,167  25,793,656  103,300,873  27,547,147
  Change in Fair Value from Prior Year End of Outstanding and Unvested Awards Granted in Prior Years  32,763,652  12,828,520  16,199,600  7,769,730  0  38,719,413
  Change in Fair Value from Prior Year End of Vested(a) Awards Granted in Prior Years  86,782  (2,249,765)  (517,680)  2,983,282  192,158,369  4,013,351
  Fair Value at Vesting Date of Vested Awards Granted in Current Year  3,585,238  0  0  0  0  0
  Compensation Actually Paid  106,643,588  41,980,664  128,833,021  41,564,946  311,845,801  75,307,922

 

  (a) For the purposes of CAP and this table, time-based RSUs are considered “vested” on the date of retirement eligibility. As a result, 100% of the time-based RSUs granted to Mr. Cook in 2021 and 2022 RSUs were considered “vested”. A pro rata portion of Mr. Cook’s 2023 time-based RSUs are considered “vested” consistent with the retirement provisions of that award. No other NEOs, other than Mr. Cook, have retirement provisions in their equity awards. The fair values of the RSUs included in the compensation actually paid to our CEO and the average compensation actually paid to our other NEOs are calculated at the required measurement dates, consistent with the approach used to value the awards at the grant date as described above in footnote 1 to the “Summary Compensation Table – 2023, 2022, and 2021” and footnote 1 to the “Grants of Plan-Based Awards – 2023” table, respectively. Any changes to the time-based RSU and performance-based RSU grant date fair values (for 2023 grants) and from prior year-end (for 2021 and 2022 grants) are based on an updated stock price valuation on the measurement dates and for the performance-based RSUs, including updated input variables for the Monte-Carlo model to estimate the probability of satisfying the performance objectives established for the respective award.

 

(3) The dollar amounts in column (d) represent the average amounts of compensation reported for the other NEOs for each corresponding year in the “Total” column of the “Summary Compensation Table – 2023, 2022, and 2021” as set forth on page 62 of this proxy statement. For each of 2021, 2022 and 2023, the other NEOs were Luca Maestri, Kate Adams, Deirdre O’Brien, and Jeff Williams.

   
(4) Apple’s TSR in column (f) was determined based on the value of an initial fixed investment of $100, as of September 26, 2020, including the reinvestment of any dividends. 
   
(5) The peer groups used to calculate Peer Group TSR in column (g) are our primary peer group as disclosed in the Compensation Discussion and Analysis section of this Proxy Statement, our 2023 Proxy Statement for 2022 and our 2022 Proxy Statement for 2021. TSR is based on the value of an initial fixed investment of $100 at the start of 2021 and is weighted for the market capitalization of each peer company in each applicable year. 
   
(6) In addition to Relative TSR and Operating Income, Net Sales in column (i) represents the most important financial performance measure used to link Compensation Actually Paid to company performance (the “Company Selected Measure” as defined in the Pay Versus Performance rules).  
   
Company Selected Measure Name Net Sales    
Named Executive Officers, Footnote [Text Block]

 

(1) The dollar amounts in column (b) represent the compensation reported for Mr. Cook for each corresponding year in the “Total” column of the “Summary Compensation Table – 2023, 2022, and 2021” on page 62 of this Proxy Statement.

 

 
(3) The dollar amounts in column (d) represent the average amounts of compensation reported for the other NEOs for each corresponding year in the “Total” column of the “Summary Compensation Table – 2023, 2022, and 2021” as set forth on page 62 of this proxy statement. For each of 2021, 2022 and 2023, the other NEOs were Luca Maestri, Kate Adams, Deirdre O’Brien, and Jeff Williams.
   
Peer Group Issuers, Footnote [Text Block]
(5) The peer groups used to calculate Peer Group TSR in column (g) are our primary peer group as disclosed in the Compensation Discussion and Analysis section of this Proxy Statement, our 2023 Proxy Statement for 2022 and our 2022 Proxy Statement for 2021. TSR is based on the value of an initial fixed investment of $100 at the start of 2021 and is weighted for the market capitalization of each peer company in each applicable year. 
   
   
Adjustment To PEO Compensation, Footnote [Text Block]

 

     2023  2022  2021
     Mr. Cook ($)  Average for
Other
NEO ($)
  Mr. Cook ($)  Average for
Other
NEO($)
  Mr. Cook ($)  Average for
Other
NEO ($)
  Summary Compensation Table (“SCT”) Total  63,209,845  26,943,956  99,420,097  27,150,293  98,734,394  26,987,631
  Grant Date Fair Value of Stock Awards from SCT  (46,970,283)  (22,323,641)  (82,994,164)  (22,132,015)  (82,347,835)  (21,959,620)
  Fair Value of Equity Awards Granted in the Year and Unvested as of Year End  53,968,355  26,781,593  96,725,167  25,793,656  103,300,873  27,547,147
  Change in Fair Value from Prior Year End of Outstanding and Unvested Awards Granted in Prior Years  32,763,652  12,828,520  16,199,600  7,769,730  0  38,719,413
  Change in Fair Value from Prior Year End of Vested(a) Awards Granted in Prior Years  86,782  (2,249,765)  (517,680)  2,983,282  192,158,369  4,013,351
  Fair Value at Vesting Date of Vested Awards Granted in Current Year  3,585,238  0  0  0  0  0
  Compensation Actually Paid  106,643,588  41,980,664  128,833,021  41,564,946  311,845,801  75,307,922

 

   
Non-PEO NEO Average Total Compensation Amount $ 26,943,956 $ 27,150,293 $ 26,987,631
Non-PEO NEO Average Compensation Actually Paid Amount $ 41,980,664 41,564,946 75,307,922
Adjustment to Non-PEO NEO Compensation Footnote [Text Block]

     2023  2022  2021
     Mr. Cook ($)  Average for
Other
NEO ($)
  Mr. Cook ($)  Average for
Other
NEO($)
  Mr. Cook ($)  Average for
Other
NEO ($)
  Summary Compensation Table (“SCT”) Total  63,209,845  26,943,956  99,420,097  27,150,293  98,734,394  26,987,631
  Grant Date Fair Value of Stock Awards from SCT  (46,970,283)  (22,323,641)  (82,994,164)  (22,132,015)  (82,347,835)  (21,959,620)
  Fair Value of Equity Awards Granted in the Year and Unvested as of Year End  53,968,355  26,781,593  96,725,167  25,793,656  103,300,873  27,547,147
  Change in Fair Value from Prior Year End of Outstanding and Unvested Awards Granted in Prior Years  32,763,652  12,828,520  16,199,600  7,769,730  0  38,719,413
  Change in Fair Value from Prior Year End of Vested(a) Awards Granted in Prior Years  86,782  (2,249,765)  (517,680)  2,983,282  192,158,369  4,013,351
  Fair Value at Vesting Date of Vested Awards Granted in Current Year  3,585,238  0  0  0  0  0
  Compensation Actually Paid  106,643,588  41,980,664  128,833,021  41,564,946  311,845,801  75,307,922
   
Compensation Actually Paid vs. Total Shareholder Return [Text Block]

Relationship Between Compensation Actually Paid and our Total Shareholder Return

 

Long-term equity incentives represent a vast majority of our NEOs’ total target compensation and our stock price performance or TSR is the key driver of Compensation Actually Paid. We also use Relative TSR as the key performance measure for our performance-based RSUs.  Over the three-year period covered in this disclosure, Apple’s TSR on an absolute basis was high, 55.24%, and outperformed the TSR of our primary peer group by 16.88%.  Apple’s Relative TSR measured against the members of the S&P 500 Index (the peer group for performance-based RSUs) was also strong, resulting in above-target payouts for the performance-based RSUs with applicable performance periods ending in 2021, 2022, and 2023. Further, the TSR relative to the currently outstanding performance-based RSUs (granted in 2022 and 2023) continues to trend towards above-target payouts due to strong TSR relative to the members of the S&P 500.  This shows how Compensation Actually Paid to our NEOs and TSR are tightly linked.

 

The 2021 Compensation Actually Paid values for the CEO and NEOs are higher than the Summary Compensation Table totals in 2021, and higher than the Compensation Actually Paid values in 2022 and 2023 because Apple’s significant and outstanding stock price increase in the years immediately preceding 2021 resulted in our NEOs holding a larger value of unvested equity awards as of the start of 2021.  

   
Compensation Actually Paid vs. Net Income [Text Block]

Relationship Between Compensation Actually Paid and Net Income

 

Net Income is generally a key indicator of company profitability and for Apple can contribute to changes in our stock price, which in turn drives Compensation Actually Paid.  We do not use Net Income as a financial measure in our executive compensation program but Operating Income from which Net Income is derived. Operating Income and Net Sales are the two financial performance measures for our Cash Incentive Plan.

   
Compensation Actually Paid vs. Company Selected Measure [Text Block]

Relationship Between Compensation Actually Paid and Net Sales

 

Net Sales is one of the two financial measures, the People and Compensation Committee has set for our Cash Incentive Plan, and therefore along with Operating Income is the next most important financial metric in determining Compensation Actually Paid behind Relative TSR. Strong performance in Net Sales and Operating Income led to above target bonus payouts in 2021, 2022, and 2023 which in turn increased Compensation Actually Paid.

   
Tabular List [Table Text Block]

Tabular List of Apple’s most important metrics that link Compensation Actually Paid to the Mr. Cook and other NEOs

 

For 2023, the following list represented the most important financial performance measures used by Apple to link Compensation Actually Paid with our financial performance:

 

Net Sales  
Operating Income  
Relative TSR  
   
Total Shareholder Return Amount $ 155.24 135.59 131.69
Peer Group Total Shareholder Return Amount 116.88 92.09 136.57
Net Income (Loss) Attributable to Parent $ 96,995,000,000 $ 99,803,000,000 $ 94,680,000,000
Company Selected Measure Amount 383,285,000,000 394,328,000,000 365,817,000,000
Measure [Axis]: 1      
Pay vs Performance Disclosure [Table]      
Measure Name Net Sales    
Measure [Axis]: 2      
Pay vs Performance Disclosure [Table]      
Measure Name Operating Income    
Measure [Axis]: 3      
Pay vs Performance Disclosure [Table]      
Measure Name Relative TSR    
Non-PEO NEO [Member] | Grant Date Fair Value of Stock Awards from SCT      
Pay vs Performance Disclosure [Table]      
Adjustment to Compensation Amount $ (22,323,641) $ (22,132,015) $ (21,959,620)
Non-PEO NEO [Member] | Fair Value of Equity Awards Granted in the Year and Unvested as of Year End      
Pay vs Performance Disclosure [Table]      
Adjustment to Compensation Amount 26,781,593 25,793,656 27,547,147
Non-PEO NEO [Member] | Change in Fair Value from Prior Year End of Outstanding and Unvested Awards Granted in Prior Years      
Pay vs Performance Disclosure [Table]      
Adjustment to Compensation Amount 12,828,520 7,769,730 38,719,413
Non-PEO NEO [Member] | Change in Fair Value from Prior Year End of Vested Awards Granted in Prior Years      
Pay vs Performance Disclosure [Table]      
Adjustment to Compensation Amount [1] (2,249,765) 2,983,282 4,013,351
Non-PEO NEO [Member] | Fair Value at Vesting Date of Vested Awards Granted in Current Year      
Pay vs Performance Disclosure [Table]      
Adjustment to Compensation Amount 0 0 0
Mr. Cook      
Pay vs Performance Disclosure [Table]      
PEO Total Compensation Amount 63,209,845 99,420,097 98,734,394
PEO Actually Paid Compensation Amount $ 106,643,588 $ 128,833,021 $ 311,845,801
Mr. Cook | PEO [Member]      
Pay vs Performance Disclosure [Table]      
PEO Name Mr. Cook Mr. Cook Mr. Cook
Mr. Cook | PEO [Member] | Grant Date Fair Value of Stock Awards from SCT      
Pay vs Performance Disclosure [Table]      
Adjustment to Compensation Amount $ (46,970,283) $ (82,994,164) $ (82,347,835)
Mr. Cook | PEO [Member] | Fair Value of Equity Awards Granted in the Year and Unvested as of Year End      
Pay vs Performance Disclosure [Table]      
Adjustment to Compensation Amount 53,968,355 96,725,167 103,300,873
Mr. Cook | PEO [Member] | Change in Fair Value from Prior Year End of Outstanding and Unvested Awards Granted in Prior Years      
Pay vs Performance Disclosure [Table]      
Adjustment to Compensation Amount 32,763,652 16,199,600 0
Mr. Cook | PEO [Member] | Change in Fair Value from Prior Year End of Vested Awards Granted in Prior Years      
Pay vs Performance Disclosure [Table]      
Adjustment to Compensation Amount [1] 86,782 (517,680) 192,158,369
Mr. Cook | PEO [Member] | Fair Value at Vesting Date of Vested Awards Granted in Current Year      
Pay vs Performance Disclosure [Table]      
Adjustment to Compensation Amount $ 3,585,238 $ 0 $ 0
Luca Maestri | Non-PEO NEO [Member]      
Pay vs Performance Disclosure [Table]      
PEO Name Luca Maestri Luca Maestri Luca Maestri
Kate Adams | Non-PEO NEO [Member]      
Pay vs Performance Disclosure [Table]      
PEO Name Kate Adams Kate Adams Kate Adams
Deirdre O’Brien | Non-PEO NEO [Member]      
Pay vs Performance Disclosure [Table]      
PEO Name Deirdre O’Brien Deirdre O’Brien Deirdre O’Brien
Jeff Williams | Non-PEO NEO [Member]      
Pay vs Performance Disclosure [Table]      
PEO Name Jeff Williams Jeff Williams Jeff Williams
[1] For the purposes of CAP and this table, time-based RSUs are considered “vested” on the date of retirement eligibility. As a result, 100% of the time-based RSUs granted to Mr. Cook in 2021 and 2022 RSUs were considered “vested”. A pro rata portion of Mr. Cook’s 2023 time-based RSUs are considered “vested” consistent with the retirement provisions of that award. No other NEOs, other than Mr. Cook, have retirement provisions in their equity awards. The fair values of the RSUs included in the compensation actually paid to our CEO and the average compensation actually paid to our other NEOs are calculated at the required measurement dates, consistent with the approach used to value the awards at the grant date as described above in footnote 1 to the “Summary Compensation Table – 2023, 2022, and 2021” and footnote 1 to the “Grants of Plan-Based Awards – 2023” table, respectively. Any changes to the time-based RSU and performance-based RSU grant date fair values (for 2023 grants) and from prior year-end (for 2021 and 2022 grants) are based on an updated stock price valuation on the measurement dates and for the performance-based RSUs, including updated input variables for the Monte-Carlo model to estimate the probability of satisfying the performance objectives established for the respective award.