It is no secret that the tech giant has been making big money in recent times, with booming sales of its iDevices and App store success the company is playing with loads and loads of money, $97.6 billion to be exact. Obviously with this amount of money present as cash balance many eyes were raised as to what Apple would or should do with this kind of money — although it acquired an Israeli chipmaker Anobit and Chomp, a app store search service, and many other acquisitions can be scene in the future to prolong its growth.
Until Steve Jobs‘ death the company maintained its stance of not paying any dividend to its shareholders, but since his death CEO Tim cook has been pondering upon the prospect of buying goodwill of its investors and shareholders with the help of this cash. Not only Tim but the investors and shareholders themselves kept on asking again and again what the fruit company planned to do with this huge revenue. Shareholders with a large number of stocks were also getting restless and asked for dividends many a times.
It was only a matter of time before Apple publicly announced what it really planned to do with this humongous cash balance and that time was today when the company held a conference call to state that it would pay $2.65 per share and would start a $10 billion buyback program.
That is a generous way to thank all its investors, shareholders and people completely unrelated to the company. The buyback initiative wouldn’t start until its 2013 fiscal year while the dividend program would commence from the 1st of July which marks the start of fiscal fourth quarter for the company.
The question one might then ask, would Apple be able to cope with such spending? Will it continue to grow? Well, surprisingly enough according to figures the fruit company might double this cash balance even with such spending in coming three years, where it generated $33 billion last year , it is projected to be $40 billion this year, $50 billion the next year and $60 billion in the following year, this amounts to a total of $150 billion over the next three years, where as it would only spend $45 billion on these programs during this time raising its cash balance to $200 billion after three years.