Image: Apple COO Cook and CEO Jobs during a news conference in Cupertino, Calif.
Reuters
Apple COO Tim Cook, left, will be taking over for CEO Steve Jobs while he is out on a medical leave.
msnbc.com staff and news service reports
updated 1/18/2011 12:50:37 PM ET 2011-01-18T17:50:37

Apple Inc. founder and CEO Steve Jobs, a cancer survivor, sent a note Monday to employees saying he's taking a medical leave of absence so he can focus on his health.

The computer giant's shares fell by more than 8 percent on the Frankfurt Stock Exchange on the report, Reuters reported. U.S. markets were closed Monday for the Martin Luther King Jr. holiday.

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"I love Apple so much and hope to be back as soon as I can," the Apple co-founder said in the statement.

Jobs added that he will continue as chief executive and continue to be involved in major strategic decisions for the company.

Chief Operating Officer Tim Cook, 50, will be responsible for day-to-day operations. Cook stepped into the role from January through June 2009 while Jobs was on leave.  Many people consider Cook as Jobs' logical successor.

Story: Apple again turns to Tim Cook in CEO Jobs’ absence

This is the third time in ten years that Jobs, 55, who has had pancreatic cancer and underwent a liver transplant while on leave in 2009, has stepped  back from his position at Apple.

Jobs is seen as central to Apple's performance. In the last decade, he propelled it into the consumer-electronics market with the blockbuster and widely copied iPod and iPhone. It also produced the iPad tablet computer and super-thin MacBook Air During his tenure.

In 2010, Apple overtook Microsoft to become the world's biggest technology company by market capitalization.

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The announcement was a surprise, Exane BNP Paribas analyst Alexander Peterc told Bloomberg.

"There was no hint of trouble at all," he said, adding: "The lack of a more precise indication on the length of the leave suggests there are long-term issues with his health."

Cupertino, California-based Apple is due to report its fourth quarter results after market close on Tuesday. The company is expected to post a 50-percent rise in revenues on sales of the iPad, Reuters reported.

Jobs was expected to unveil a new digital publication for the iPad with Rupert Murdoch's News Corp. in the next few days, but the event was delayed recently, according to The Wall Street Journal.

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Analysts said the effect on Apple's operations should be limited in the short term, since its product line-up was strong, but his absence would be a worry if it became prolonged.

"It wasn't expected. This will come as a surprise to Apple investors and definitely take some shine off the Apple stock," Alexander Peterc, an equity analyst at Exane, told Reuters.

"But even if Steve Jobs never returns to Apple, I would not expect a visible, tangible impact on how Apple is executing over the next couple of years."

Richard Windsor, global technology specialist at Nomura, agreed that a Jobs absence should not have a fundamental effect, but added: "Perception of the company is another matter."

"Steve Jobs is seen by the market to be a major force in Apple's strategic direction. If his pancreatic cancer has returned, one could be quite worried."

Jobs still appeared thin at recent Apple events, something that did not go unnoticed. But the CEO said last summer he was feeling "great," in response to a question from a reporter.

Jobs asked for privacy during his leave.

"In the meantime, my family and I would deeply appreciate respect for our privacy," he said in the statement.

Apple has a long history of secrecy when it comes to the iconic CEO's health, disclosing major illnesses only after the fact. Jobs was "cured" of a rare form of pancreatic cancer called an islet cell neuroendocrine tumor in 2004, but his surgery and recovery were not made public until afterward.

Then, during a six-month medical leave from January to June 2009, Jobs had a liver transplant. When the leave was announced, there were scant details about his actual diagnosis, and the transplant came to light two months after it was performed.

Monday's relatively vague statement "leaves a lot to the imagination," Charles Elson, head of the Weinberg Center for Corporate Governance at the University of Delaware's busines school, told The Wall Street Journal.

Story: Jobs' medical leave may be due to rare form of cancer

"They need to be as specific with investors as (Jobs) has been with them about the nature of his health difficulties and when he may come back,'' Elson added.

Few CEOs are considered as instrumental to their companies as Jobs has been to Apple since he returned in 1997 after a 12-year hiatus. With Jobs serving as head showman and demanding elegance in product design, Apple has expanded from a niche computer maker to become the dominant producer of portable music players, a huge player in the cell phone business and the inventor, with the iPad, of a new category of tablet computers.

After Jobs helped found the company in 1976, he was pushed out in 1985 in a boardroom coup.

Technolog: Apple will stay the course, near-term

Cook joined Apple in 1998 and ran the Cupertino, Calif.-based company for two months in 2004 while Jobs recovered from surgery for pancreatic cancer. His performance won him the promotion to chief operating officer in 2005.

Analysts credit Cook with solving problems that Apple was having with inventory management. Many people consider Cook as Jobs' logical successor.

Under Cook's direction in 2009, the company kept cranking out well-received products including updated laptops with lower entry-level prices and a faster iPhone with many longed-for features. Apple sold more than a million of the new iPhone 3GS during its first three days on the market.

The Associated Press and Reuters contributed to this report.

Video: Apple CEO Steve Jobs takes medical leave

Timeline: Timeline: Steve Jobs, the life of an innovator

Vote: Vote: Can Apple survive without Steve Jobs?

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