Apple to host conference call Monday to discuss its $100B cash balance

Posted:
in AAPL Investors edited January 2014


Apple will host a conference call on Monday at 9 a.m. Eastern, 6 a.m. Pacific to discuss what it plans to do with its $100 billion cash balance.



The company issued a press release at 6 p.m. Eastern on Sunday evening to announce the conference call less than 24 hours in advance. The call will feature Apple Chief Executive Tim Cook and Chief Financial Officer Peter Oppenheimer.



On the call, the company "will announce the outcome of (its) discussions concerning its cash balance." The press release also said that Apple would not provide an update on its current quarter, nor would it discuss any topics other than cash.



Last quarter, Apple's cash hoard grew to nearly $100 billion, prompting a great deal of discussion among investors and analysts. Executives at Apple simply said that they were "actively discussing" what to do with the money.



Last month, at Apple's annual shareholder meeting, investors again questioned Cook about what Apple planned to do with its cash hoard, with some of them pushing for a cash dividend. But Cook wouldn't commit to any such plans and instead repeated his comments that Apple executives were thinking "very deeply" about what to do with its money.





The growth trajectory of Apple's cash hoard, via Asymco.







With its cash, Apple has continued to make strategic investments to bolster its supply chain and also enhance its current product offerings, as it did with the $50 million purchase of App Store search engine Chomp revealed last month.



AppleInsider will have full live coverage of Apple's conference call when it takes place on Monday morning.



[ View article on AppleInsider ]

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Comments

  • moxommoxom Posts: 325member
    I'll keep it safe in my Piggy Bank whilst they decide on what they are going to do...



  • buzzzbuzzz Posts: 84member
    It would be nice if at least some of that money went to some sort of scholarship fund. Especially for kids wanting to study engineering or some other similar feild of study.
  • tyler82tyler82 Posts: 500member
    Lickable iPads!
  • cgjcgj Posts: 276member
    I hope it's not a dividend.



    I hope it's education pricing for iPads and automatic AppleCare
  • solipsismxsolipsismx Posts: 19,566member
    I'd like a stock buy back and for Apple to announce plans to split the stock. I'm expecting a dividend and an announcement of how successful this weekend's iPads were.



    edit: I withdraw my buyback comment for a time when the stock market is suffering.
  • rogifanrogifan Posts: 10,669member
    Quote:
    Originally Posted by SolipsismX View Post


    I'd like a stock buy back and for Apple to announce plans to split the stock. I'm expecting a dividend and an announcement of how successful this weekend's iPads were.



    apparently they're not going to discuss the quarter so my guess is we won't get any iPad numbers.
  • aaronjaaronj Posts: 1,543member
    This should be very interesting, on a couple of different levels. I'm interested to see both what they've decided, and how those decisions effect the market.



    It could end up being a whale of day. I'm going to refrain from trying to predict anything, though. Every time I do that, I'm wrong.
  • mike fixmike fix Posts: 210member
    I hope it's all for PRO development! (Truth / Sarcasm)
  • bobringerbobringer Posts: 102member
    Grrr...



    They do this on a Monday morning before the market opens... after a weekend where I moved most of my short term options to cash in case Greece blew up or something.



    :-/



    It's obviously either buyback... or more likely a dividend.



    Whatever Oppenheimer... whatever...
  • dasanman69dasanman69 Posts: 12,152member
    Quote:
    Originally Posted by CGJ View Post


    I hope it's not a dividend.



    I hope it's education pricing for iPads and automatic AppleCare



    Education pricing would be great, the biggest reason I'll be getting one is to benefit my son's education.
  • dunksdunks Posts: 1,155member
    Sad. I wanted to invest in AAPL stock way back in 2003, but I couldn't spare the cash at the time (I was a university student living on 2 minute noodles).
  • kpomkpom Posts: 515member
    I'm guessing they will announce plans for a special dividend sometime in 2012. Right now, qualifying dividends are taxed at 15% rather than at normal income rates (i.e. the same as long term capital gains). That special tax treatment is set to expire at the end of the year.



    I also think they will announce plans to invest a portion of their stockpile in an "incubator" for research and development (i.e. making private equity-type investments in startups). That would be productive use of the money, and potentially give Apple some leverage in the coming years in terms of intellectual property.



    Apple has a big enough stockpile of cash and investments that today, it really looks like an investment manager and technology company rolled into one.
  • kpomkpom Posts: 515member
    Quote:
    Originally Posted by Rogifan View Post


    apparently they're not going to discuss the quarter so my guess is we won't get any iPad numbers.



    Not on the 9AM (Eastern) call, but I would not be surprised if later on in the day or Tuesday they issue a separate press release announcing weekend sales. Whatever they decided to do with cash will have a significant impact on their stock trading activity tomorrow, and so might speculation about iPad sales. I'm guessing the board met this weekend to approve whatever Tim Cook and Peter Oppenheimer will announce, though I find it a bid odd they decided to do it the same weekend the new iPad launched.
  • greginpraguegreginprague Posts: 404member
    Quote:
    Originally Posted by SolipsismX View Post


    I'd like a stock buy back and for Apple to announce plans to split the stock. I'm expecting a dividend and an announcement of how successful this weekend's iPads were.



    Realistically the only two options are buy back or dividend at this point, right? They wouldn't hold a press conference if they were just going to let the cash pile keep growing.



    Good thing I bought a few more shares in my Roth IRA and my sons college fund on Friday.
  • applegreenapplegreen Posts: 421member
    My guess: A one-time dividend. Something like $20 per share. I don't think Apple will commit to a regular dividend. They may announce a share buyback, but are they going to buy at these levels? They may just say that they will decide when it is appropriate to buy shares.



    Perhaps, a one-time bonus for all workers including those at Foxconn? It will be interesting to see how they approach this.
  • drax7drax7 Posts: 38member
    Quote:
    Originally Posted by dasanman69 View Post


    Education pricing would be great, the biggest reason I'll be getting one is to benefit my son's education.



    This is a business, forget this education nonsense.
  • applegreenapplegreen Posts: 421member
    Quote:
    Originally Posted by GregInPrague View Post


    Realistically the only two options are buy back or dividend at this point, right? They wouldn't hold a press conference if they were just going to let the cash pile keep growing.



    Good thing I bought a few more shares in my Roth IRA and my sons college fund on Friday.



    I own shares in my Roth as well, but what they do with the cash will not change Apple's value near term although trading may be volatile on Monday. My intention is to keep the shares until something fundamental changes.
  • kpomkpom Posts: 515member
    Quote:
    Originally Posted by GregInPrague View Post


    Realistically the only two options are buy back or dividend at this point, right? They wouldn't hold a press conference if they were just going to let the cash pile keep growing.



    Good thing I bought a few more shares in my Roth IRA and my sons college fund on Friday.



    Those are the only two realistic ways of reducing the cash/investment balance (only a quarter of it is actually cash and 2/3 of it is in long-term investments). For 2012, at least as far as American shareholders are concerned, a special dividend would be taxed at 15% (the same as a long term capital gain), so that is one way of doing it. A stock buyback doesn't make a whole lot of sense when the stock is trading at a record high, so I'm leaning toward a special dividend.



    However, they might announce plans to change how they invest whatever amount they decide to keep (hence my speculation that they might announce the creation of a private equity-type fund).



    Quote:
    Originally Posted by AppleGreen View Post


    I own shares in my Roth as well, but what they do with the cash will not change Apple's value near term although trading may be volatile on Monday. My intention is to keep the shares until something fundamental changes.



    Same here. A Roth has been the best place for it given how much it has increased over the past few months. That said, announcing a small regular dividend would make it an eligible investment for some pension plans and mutual funds whose charters don't allow them to invest in stocks that don't pay dividends. So if they announce a $20/share special dividend (which would reduce cash by about $19 billion), that might not preclude them from announcing a nominal regular dividend, such as $1/share to keep cash at manageable levels. It would be a yield of less than 0.2% so it won't exactly become a utility.
  • mdriftmeyermdriftmeyer Posts: 6,751member
    Quote:
    Originally Posted by SolipsismX View Post


    I'd like a stock buy back and for Apple to announce plans to split the stock. I'm expecting a dividend and an announcement of how successful this weekend's iPads were.



    If you wanted that you should have bought Microsoft during it's rise. They've overly split the stock to a point now that it will never go up for squat.
  • minnesota_steveminnesota_steve Posts: 109member
    Quote:
    Originally Posted by AppleGreen View Post


    My guess: A one-time dividend. Something like $20 per share.



    Of course that would be awesome. We'll see. But it would be a timely distribution in 2012 given that dividends will be taxed more heavily starting in 2013.
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