Steve Jobs Back at Work: Now what for Apple and Competitors?

In late June 2009, Steve Jobs returned to work as Apple Inc.’s (AAPL) CEO. His return comes following a surprise five-month hiatus, which Jobs claimed he needed as the result of “complex” health issues. We now know he had a liver transplant at a Memphis hospital in April. Speculation about Jobs’s health and the future of Apple has swirled for months, ever since he appeared gaunt at public appearances last summer. Given his and his company’s prior dissembling about his health, can we now trust assurances that he is recovering well? And what does this all mean for Apple and its competitors?

Realistically, Steve Jobs’s return as CEO probably means very little. While Jobs has been the driving force behind Apple for most of its history, he has created a company that is, in many ways, a clone of himself. Every Apple employee, from management on down, understands that the company’s mission is to produce quality, user-friendly products. And to convince an increasing frugal public to pay a premium for those products. Apple fulfills this mission well and will likely continue to do so with or without Steve Jobs.

The notion that Apple can succeed without Steve Jobs might have seemed unthinkable just a few months ago. Prior to his recent leave, Apple stock rose and fell in concert with speculation about his health and his ability to continue to run the company. However, after an initial nosedive immediately following the announcement of Jobs’s impending leave, Apple shares have risen over the past five months.

During Steve Jobs’s medical leave, Apple has introduced new and improved products that have done well. The newest iPhone, the 3GS, flew off store shelves, less expensive laptops have been well received and updated Mac software is keeping the Apple image shiny.

Apple’s direct competitors in the computer market, Dell, Inc. (DELL); Microsoft Corporation (MSFT) and Hewlett-Packard Company (HPQ), have greater total revenue than Apple, but they have all seen their year-over-year quarterly revenue growth decline, while Apple’s has increased. Apple’s gross margins are also significantly better than either Dell or Hewlett-Packard.

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On the smartphone front, Palm, Inc.’s (PALM) Pre and Nokia Corp.’s (NOK) N97 are giving the iPhone a run for the money, but Apple brilliantly parried by celebrating the release of the newest 3G S phones (in 16 GB and 32 GB versions) with a price drop for the 8 GB 3G iPhone to just $99. Palm and Nokia now must compete on price point as well as technology.

Clearly, Apple has performed well during its leader and co-founder’s absence. While it is probably premature to say Apple no longer needs Steve Jobs, it does seem safe to say that Jobs has created a self-sufficient company that can stand on its own. If he just goes back to the job he was doing before his leave, it’s unlikely he will create many waves. If, however, he pulls back on the day-to-day managing and concentrates his genius on the outside-the-box thinking that has positioned Apple so well, he could make Apple an even stronger company.

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[tags] Steve Jobs, liver transplant, Memphis, iPhone, smartphone, Pre, $SPX, S&P 500 Index, AAPL, Apple Computer Inc., DELL, Dell Computer Corp., HPQ, Hewlett Packard, MSFT, Microsoft Corp., NOK, Nokia Corp. ADR, PALM, palmOne Inc., SPY, S&P Depositary Receipts Trust ETF [/tags]