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Summary:

Jeff Segal of BreakingViews tries to calculate the value of Steve Jobs to Apple. Apple Mac Line at twice the industry average multiple (1.3 times revenue) is worth about $19 billion. iPod business at five times EBITDA is worth about $14 billion. iTunes music store at […]

Jeff Segal of BreakingViews tries to calculate the value of Steve Jobs to Apple.

  • Apple Mac Line at twice the industry average multiple (1.3 times revenue) is worth about $19 billion.
  • iPod business at five times EBITDA is worth about $14 billion.
  • iTunes music store at six times EBITDA is worth about $1 billion.
  • iPhone business could be worth about $17 billion.
  • Other businesses, about $11 billion, using Microsoft multiple of 2.8 times revenue.

In total, these businesses can be valued at $60 billion. Given that Apple has a market capitalization of $80 billion, Segal concludes that Jobs is worth $20 billion to Apple’s shareholders. Jobs gets a premium because he is the Pied Piper who makes it all come together, and that is why Apple shareholders need a rock-solid succession plan. 

While Segal does have a point about the succession plan, I would be hard-pressed to buy into the $20 billion valuation. He also didn’t factor in the $24.5 mbillion in cash Apple has in its coffers. To me, Apple is Jobs and Jobs is Apple. What do you guys think?

  1. If Leaders set a goal and use data to reach it (Steve Jobs)
    Managers use data to set goal and reach it (Steve Ballmer)

    Then Steve Jobs is much harder to replace, or how does one identify a leader who knows what the goal should be. Managers on the other hand can be trained.
    In other words Apple has a problem on it’s books, no matter how well Steve J is.

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  2. Yeah Man, that guy is a legend.

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  3. I think Jobs is more important to the media and those of us that have waited on baited breath for his every announcement over the years than to all the new Apple customers that know them just by the products, advertising, and the Apple stores. To those, as long as Apple produces new, nifty products, who cares who’s behind it all.

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  4. I heard the same $20 billion value for Jobs when Apple’s stock price was double what it is now. That means Steve Jobs is now worth double what he was last year, relatively speaking. ???

    Also, I think you need to change millions to billions when talking about the Apple cash pile.

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  5. Totally right. Jobs = Apple

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  6. [...] December 18, 2008 How much is Steve Jobs worth to Apple? That’s the question addressed in an article by Jeff Segal (which I saw thanks to Om). [...]

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  7. It’s $25 billion in cash; which means that according to these number Steve Jobs is worth negative 5 billion. maybe the markets have factored the whole succession thing in already.

    Throw in goodwill and the corporate logo, and Steve is worth even less.

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  8. So if you add in the cash Apple has, which I might add is the only real number here, Jobs is worth -$500M Which is nuts. I guess it is a slow day for Apple news.

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  9. “He also didn’t factor in the $24.5 million in cash Apple has in its coffers.”

    is it million or billion?

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  10. Two morbid thoughts come to mind…

    1) Not likely anyone would create a life insurance policy for one guy at $20 billion. Don’t think Lloyd’s of London would take that action, not even back in the day when Lloyd’s and the markets were flush

    2) Does this mean you short Apple stock if Jobs dies? That’s pretty morbid…

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