Tim Cook announces $14 billion Apple stock repurchase

Tim Cook announces $14 billion Apple stock repurchase

Summary: The Apple CEO says that Apple wants to be 'aggressive' and 'opportunistic.' This one has Carl Icahn's fingerprints all over it.

SHARE:
TOPICS: Apple
15
Tim Cook: Apple repurchases $14 billion of stock - Jason O'Grady
Photo: InsiderMonkey.com

The Wall Street Journal is reporting that Apple ($AAPL) has repurchased $14 billion of its own stock within the past two weeks. The move means that Apple had bought back more than $40 billion of its shares over the past 12 months, which Cook called "a record for any company over a similar span."

In an interview Cook said that Apple was "surprised" by the 8 percent drop in AAPL share since it reported quarterly results on January 28, 2014. Cook said that Apple wanted to be "aggressive" and "opportunistic."

It means that we are betting on Apple. It means that we are really confident on what we are doing and what we plan to do. We're not just saying that. We're showing that with our actions.

According to Cook the recent share repurchase is part of Apple's previously disclosed plan to repurchase $60 billion of its own shares. He said Apple plans to disclose "updates" to its buyback program in March or April.

One name came to mind as soon as I read the WSJ headline: Carl Icahn. The activist shareholder has been pressuring Apple to be more aggressive with its $160 billion cash horde. Icahn owns approximately $4 billion in Apple shares and wants Apple to repurchase an additional $50 billion of its own shares by the end of September, over and above the $60 billion that the company has already committed to. 

When the stock was under pressure after Apple's Q1 earnings announcement, Icahn announced he'd purchased another $500 million worth of AAPL shares. Today's announcement comes just three weeks before Apple's February 28 shareholder meeting, where further stock repurchases could be announced. 

How would you use Apple's $160 billion in cash if you were CEO?

 

 

Topic: Apple

Kick off your day with ZDNet's daily email newsletter. It's the freshest tech news and opinion, served hot. Get it.

Talkback

15 comments
Log in or register to join the discussion
  • pay out bigger dividends to shareholders

    Which is what you're supposed to do instead of hoarding it and then wasting it on buy back schemes that do absolutely nothing for the company.
    It is just a cash out scheme for execs with share options and insiders to loot the stash at the expense of other shareholders.
    warboat
    • Huh?

      Consider the possibility that you don't know what you're talking about. Just sayin'.
      Robert Hahn
  • Apple slavers should be imprisoned

    Apple executives and those investment advisors who force the company to use overseas slave labor whiles destroying the environment should be arrested and charged with crimes against humanity without any chance of release from prison until after the trials and appeals are finished. And, of course, their bank accounts should be frozen until after the trials and appeals, by either the prosecution or defense, or both.
    Rudy Haugeneder
    • Good!

      I assume that you advocate the same for Samsung, Lenovo, Dell, HP, and every other company that sources their products from factories in China.

      No? Then why are you singling out Apple? Perhaps because you're an anti-Apple troll.
      ssaha
  • stock repurchase is a tax efficient way to reward shareholders

    Carl Icahn finds corporations with lots of cash in the bank, and drives them to reward shareholders in this way.
    stevey_d
    • yep

      he's a self perpetuating profiteer then, already knew that. Apple should just buy his shares back and get rid of him.
      iacl1
    • It's not very tax-effiicent when the cash is overseas.

      One of the reasons that Apple has so much cash is their effective use of the "Double-Irish with a Dutch-Sandwich" which leaves a the majority of the profits from their non-North America revenues essentially not tax-resident anywhere. Plus, much of that cash is actually in "cash equivalent investments", not a pile of $20s somewhere. So, converting those instruments and then repatriating the results would incur a non-negligible cost. Since the only reason Apple is buying back as much stock as they is in the hopes that Ichan will STFU for a while, I wouldn't expect Apple to do anything more than they feel they absolutely have to on that front.

      I think Tim and Peter are like those people who grew up during the Great Depression and for the rest of their lives only paid cash, saved as much as they could, and used every resource as fully as possible. Being 90 from illiquidity back in '97 probably scarred them for life, at least in regards to the power of Cash On Hand and a dark black balance sheet!
      matthew_maurice
    • It's not very tax-effiicent when the cash is overseas.

      One of the reasons that Apple has so much cash is their effective use of the "Double-Irish with a Dutch-Sandwich" which leaves a the majority of the profits from their non-North America revenues essentially not tax-resident anywhere. Plus, much of that cash is actually in "cash equivalent investments", not a pile of $20s somewhere. So, converting those instruments and then repatriating the results would incur a non-negligible cost. Since the only reason Apple is buying back as much stock as they is in the hopes that Ichan will STFU for a while, I wouldn't expect Apple to do anything more than they feel they absolutely have to on that front.

      I think Tim and Peter are like those people who grew up during the Great Depression and for the rest of their lives only paid cash, saved as much as they could, and used every resource as fully as possible. Being 90 from illiquidity back in '97 probably scarred them for life, at least in regards to the power of Cash On Hand and a dark black balance sheet!
      matthew_maurice
  • They may as well put 14 Billion in the furnace and watch it go up in smoke

    nt
    greywolf7
  • What would Jobs have said....

    ..to the likes of Carl Icahn? I think this says more about Cook than Icahn.
    Rann Xeroxx
    • It's hard to say, but...

      ...it's a lot easier for me to imagine Jobs telling Icahn where to go than to imagine Cook doing it.
      John L. Ries
    • Could be worse

      Ichann is an interesting character.

      Don't play him for a fool. It's one of those types of things that takes time. Remember, when Steve Jobs needed money, so in the end, Steve Jobs created a Hedge Fund called Braeburn.

      Ichann is doing Apple a favor.
      MalcolmTucker
  • Shareholders or Customers?

    Shareholders are obviously way more important than their customers. And with the shareholders the fortune that Cook amasses through a higher stock price. It is not the first time that people like Icahn are putting themselves far above the customers. We haven't seen any catchy product since job left for a better world. Maybe putting 14 Billion in additional research or start ups would be a better plan. To speak with the under minister of foreign affairs of the US F*** the shareholders.
    rhon@...
  • Stop access of Syran Druglords access to the next Steve Jobs

    We all know that Steve Jobs was an abandoned child of Syrian decent. But few knew that his parents let him go because they were San Franciscan and Silicon Valley Hippies that were heavily involved in the counter culture as well as the drug trade in that area.

    When Steve Jobs was allowed to drive around California without a license plate, this should have been a key piece of evidence to not only his influence in the area, but his company's influence in Santa Clara County.

    My guess is that Steve Jobs, because of his syran decent, was able to funnel drugs including heroin and crack cocaine into Santa Clara County that even Tim Cook enjoys. But this is only a guess.
    MalcolmTucker
    • You're an idiot. That is far more than a guess.

      .DeusExMachina.