Poor Apple. Reminiscent of Richie Rich, the comic strip zillionaire who could never spend more money than his daily allowance, the Cupertino based company continues to rake in more money than it is spending. Apple has tried hard to reduce its cash hoard, and plans on spending $45 billion over the next three years on dividends and stock buybacks. Apple announced the dividend program in March at the same time it unveiled a $10 billion share buyback plan. Shareholders of record on February 11th will get Thursday's payout.
Apple is bringing in more money than it is spending
Apple CEO Tim Cook said that money in the company's piggybank has been put to good use with spending on R&D, acquisitions, new store openings and investments in the supply chain and infrastructure. And Apple will still have money for strategic opportunities. The fourth quarter brought $16 billion in cash resulting in a bank account stuffed with $137.1 billion.
Apple's dividend yield is 2.2% at current prices, and while in terms of yield there are many more higher paying stocks on the market, in terms of raw dollars, Apple is one of the highest dividend payers in the U.S. Most tech stocks, as a rule, would rather shovel cash flow back into the company, but Apple is a special case because of its large cash position. For example, rivals Google and Samsung refrain from making any dividend payouts.
(Apple has) "used some of our cash to make great investments in our business through increased research and development, acquisitions, new retail store openings, strategic prepayments and capital expenditures in our supply chain, and building out our infrastructure. You’ll see more of all of these in the future. 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."-Tim Cook, Apple CEO last March
Alan, an ardent smartphone enthusiast and a veteran writer at PhoneArena since 2009, has witnessed and chronicled the transformative years of mobile technology. Owning iconic phones from the original iPhone to the iPhone 15 Pro Max, he has seen smartphones evolve into a global phenomenon. Beyond smartphones, Alan has covered the emergence of tablets, smartwatches, and smart speakers.
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