Apple 2.0

Covering the business that Steve Jobs built

Brain drain: Apple's senior hardware chief retires rich

June 29, 2012: 8:17 AM ET

Bob Mansfield is the second key executive to leave since Steve Jobs died

Cook, Jobs and Mansfield at the antennagate press conference. Photo: WSJ

FORTUNE -- One of the concerns after Steve Jobs died was whether Apple's (AAPL) institutional values -- as embodied by his hand-picked executive team -- would survive his passing.

The team lost a key member when Ron Johnson, who built the Apple Stores, departed in November run J.C. Penney. Because Johnson made his decision to leave public nine months before Jobs died, that didn't seem to count.

But when Apple announced in a news release Thursday night that senior vice president for hardware engineering Bob Mansfield was retiring, the tech press took notice.

Although Mansfield regularly appeared in Apple's promotional videos for new products, he was not nearly as well-known as Tim Cook, Jony Ive, Phil Schiller, Scott Forstall or Eddy Cue.

But he played a critical role at the company. He was part of the troika that took over Mac engineering after the messy dismissal of Tim Bucher in 2004 and was formally put in charge of the division in 2009, supervising the production of the iMac, Mac Pro and all the MacBooks.

His responsibilities increased significantly two years ago when he took over production of Apple's mobile devices (iPod, iPhone and iPad) after the dismissal of Mark Papermaster, a former University of Texas classmate whom he had recommended for the job.

Apple's press release doesn't provide Mansfield's age, but he looks pretty young for a retiree. We've seen no evidence that he was forced out. Perhaps the burden of supervising so many important products finally took their toll.

Mansfield can certainly afford to retire. One of the executive team's savviest investors, he unloaded a lot of his beneficially owned Apple shares at peak value. Between August 2008 and March 2012, according to MarketWatch's insider trading log, he sold Apple shares worth nearly $98 million (some of them to pay taxes). According to his latest SEC filing, he still holds 64,548 shares worth, as of Thursday's close, another $36.7 million.

Other members of Apple's executive team are just as rich -- if not richer. That's one of the downsides of rewarding employees of a successful company with stock options. Keeping those multimillionaires -- and their institutional memory -- around will be one of Tim Cook's great challenges.

Mansfield's duties will be taken over by Dan Riccio, Apple's vice president of iPad hardware engineering. He's been with the company even longer than Mansfield, is reputed to have a excellent relationship with design chief Jony Ive, and didn't get nearly as many stock options as Mansfield.

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About This Author
Philip Elmer-Dewitt
Philip Elmer-DeWitt
Editor, Apple 2.0, Fortune

Philip Elmer-DeWitt has been following Apple since 1982, first for Time Magazine, and now on the Web for Fortune.com.

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