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Apple greets new retail guru Ahrendts with up to $78 million in stock awards

Gregg Keizer | May 7, 2014
Apple awarded new retail chief Angela Ahrendts stock grants that, if fully vested, would be worth as much as $78.5 million at Monday's closing price, according to SEC filings.

Her job will be crucial, said Ben Thompson, an independent analyst who operates the widely-read Stratechery website, because Apple's retail arm is critical to the company's success.

While Apple retail accounted for $5.2 billion of Apple's revenue in the March quarter — 11% of the total for the period — Thompson argued that Wall Street and industry analysts regularly undervalue the stores by tallying only sales.

In a Tuesday post on his site, Thompson said the stores give Apple significant advantages in selling its premium-priced products, even in the face of lower-cost alternatives, such as Samsung's Android-powered smartphones.

He pointed out three factors: The "try-before-you-buy" accessibility of Apple products in the stores, the in-store classes Apple conducts for customers to show them how to get the most out of their devices, and the free "Genius Bar" technical support.

"What is particularly compelling about each of these factors is that they work to Apple's advantage even if you don't buy your Apple product from an Apple Store," Thompson said. "You can try out a product there, then order it online. You can take a class with a second-hand device, and you can visit the Genius Bar no matter what. Thus, I don't think looking at direct Apple Store sales fully captures the impact they have on Apple's business."


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