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Apple shares fall after management shake-up

Apple shares dropped as much as 2.7% during early trading but recovered part of that loss before closing down 1.4% to $595.32.

November 01, 2012|By Andrea Chang and Salvador Rodriguez, Los Angeles Times

It was a rough day on Wall Street for Apple Inc., which saw its shares decline as much as 2.7% on the first day of trading since the company announced a sweeping management shake-up.

Shares fell as low as $587.70 on Wednesday morning. They recovered slightly, closing down $8.68, or 1.4%, to $595.32. Apple shares have slid more than 15% since reaching a high of $702.10 on Sept. 19.

On Monday the Cupertino, Calif., tech giant announced the departures of John Browett, Apple's head of retail, and Scott Forstall, who was in charge of the company's widely panned Siri and Maps app products.

Forstall, a longtime executive and protege of co-founder Steve Jobs, oversaw the iOS operating system that runs iPhone and iPad. But the Apple veteran was also responsible for replacing Google Inc.'s popular Maps app with Apple's own homegrown version, which has been plagued by inaccurate information and other problems since its September release. Chief Executive Tim Cook issued an apology shortly afterward and, in a rare move, encouraged users to try alternatives offered by rivals.

Browett's ouster came just six months after he was hired as Apple's senior vice president of retail. The former CEO of European technology retailer Dixons took over for Ron Johnson, who pioneered the look and feel of Apple's successful retail stores and left last year to become CEO of J.C. Penney Co.

Browett's short stint with Apple was reportedly shaky from the start. In August, he was forced to issue an apology and reverse course on a new store staffing plan, which was rumored to include hiring freezes and cutbacks in workers' hours.

The management reshuffling, Cook's biggest since becoming CEO last year, also brings more responsibilities for Jonathan "Jony" Ive, Apple's design chief; Eddy Cue, who runs Apple's online services; Bob Mansfield, who retired this year but returned to focus on "future products"; and Craig Federighi, who is now in charge of the Mac operating system.

Separately, early reviews for Apple's long-awaited iPad mini have started to trickle out.

The 7.9-inch tablet computer has largely received solid marks, although complaints about its non-retina display quality (the iPad mini features the same screen resolution as the earlier generation iPad 2) and high price have kept it from receiving glowing reviews.

Wi-Fi-only versions of the iPad mini begin shipping Friday; minis that come with cellular data plans will ship two weeks later.

Users will also have to wait a bit longer for the latest version of Apple's music player, iTunes 11, which was expected last month. Apple is now saying it will become available this month.

The update will add several features, change some portions of iTunes' design and better integrate it with iCloud, the company's cloud-computing service.

"The new iTunes is taking longer than expected, and we wanted to take a little extra time to get it right," Apple spokesman Tom Neumayr told CNET. "We look forward to releasing this new version of iTunes with its dramatically simpler and cleaner interface, and seamless integration with iCloud, before the end of November."

The company also updated the portion of its website showcasing the upcoming iTunes update to read: "Coming in November."

Apple has been more focused on hardware than software in recent months, releasing numerous new Mac computers and launching new iPods, the iPhone 5, the fourth-generation iPad and the new iPad mini.

andrea.chang@latimes.com

salvador.rodriguez@latimes.com

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