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Apple plans to use $45 billion of its cash reserves over the next three years

It's no secret that Apple is a cash machine. The company rakes in billions of dollars thanks to a legion of loyal fans that lineup hours in advance to purchase its latest and greatest phones and tablets. The company has also seen a surge in its traditional PC business thanks to strong sales of its MacBook Pro/MacBook Air lineup of notebooks and iMac all-in-one desktop computers.
 
In late January, Apple reported profit of $13 billion on revenues of $46 billion for fiscal Q1 2012. The company saw its stock price cross the $500/share threshold in early February, making it worth more than Microsoft and Google combined. More recently, AAPL has danced with the $600/share mark. In addition, Apple has roughly $100 billion in cash/securities on hand – a figure that CEO Tim Cook said is “more than we need to run the company.”
 

Apple CEO Tim Cook [Source: David Paul Morris/Bloomberg]

This morning, the company announced a $10 billion stock buyback program that will start in fiscal 2013. The buyback will take place over the course of three years with the primary goal being to "[neutralize] the impact of dilution from future employee equity grants and employee stock purchase programs."
 
A more immediate action being taking place is a quarterly dividend starting in fiscal Q4 2012. The quarterly dividend will equal $2.65/share.
 
“Even with these investments, we can maintain a war chest for strategic opportunities and have plenty of cash to run our business. So we are going to initiate a dividend and share repurchase program," said Cook.
 
According to CFO Peter Oppenheimer, these programs will burn through $45 billion of Apple's cash reserves over the next three years.

Updated @ 5:12pm
AAPL just closed above $600/share for the first time in its history. 

Source: Apple



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RE: Investors win!
By Samus on 3/19/2012 12:52:30 PM , Rating: 3
Steve Jobs is one of the most selfish billionairs in US history. He left virtually none of his wealth to non-profit or research/educational foundations, saturated Apple stock by not offering dividends and keeping the price out of reach of average investors, and with this in mind should be fittingly forgotten.

Tim Cook is a better CEO than Jobs could have ever been, and I think their finer years are ahead of them.

Did Steve Jobs save Apple? That is highly debatable. I feel he held back technology, and after the patent trolling began in 2007, that isn't debatable at all.


RE: Investors win!
By name99 on 3/19/2012 4:25:48 PM , Rating: 1
OMG so much...

(1) How do you know that Jobs left no money to education or foundations? The contents of his will (and what he did with his money beforehand) have been kept secret --- he was a private man who did not want his name in the news, even in the context of things like the name of a hospital wing.

(2) What is "saturating a stock"? And why is it a bad thing?

(3) So you think that the nominal price of a share is important? The stock is cheap if it goes through a split and costs $70 a share, but is expensive if it does not split and costs $700 a share? Good luck with that investment strategy --- there are a whole lot of penny stocks available outside NASDAQ, through pink sheets that will, I'm sure, make you rich.
And if this is something that upsets you, by all means don't go look at the price of Berkshire Hathaway.

quote:
Did Steve Jobs save Apple? That is highly debatable.

Right. And did Al Qaeda attack the US? Highly debatable. Does Intel make faster chips than ARM? Highly debatable. Was Obama born in the US? Highly debatable.


“We do believe we have a moral responsibility to keep porn off the iPhone.” -- Steve Jobs














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