Carl Icahn invests another $500M in Apple, promotes increased buyback in letter to shareholders

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Comments

  • Reply 81 of 92
    He is 100% correct.

    It is immoral to keep so much money idle. It translates to thousands of jobs...

    If given to the shareholders by increasing the share price in they will invest it in companies able to put it to good use.

    Apple could never invest in something yielding 12-15% PA with an additional capital upside.
    Their own shares will yield that easily and probably double in 2 years it is as he says a no brainer.

    Tim is a great leader and Carl says so repeatedly but this is a finance thing unrelated to the running of the company.

    Also think how it would reward Apple staff, they deserve it.
    It will make future hiring much easier.
  • Reply 82 of 92
    flabingo wrote: »
    Apple has been spending a great deal of money in people, plant, and are building a massive building in Cupertino. Someone should be in Washington having them repatriate money if spent on people, plant and equipment. It can be done on a case to case basis. And Both Apple and the US government would be better off.
    Carl's main issue is the board, he has no problem with Cook and Ives
    And explain why the Chairman of the board of Apple works FULL time as CEO of a company owned by Google

    Ive...Jony Ive. Not "Ives", like Burl Ives. Details matter.
  • Reply 83 of 92
    Originally Posted by whowhy View Post

    It is immoral to keep so much money idle.

     

    You’ve completely lost it.

     

    It translates to thousands of jobs...


     

    No, it doesn’t.

     

    If given to the shareholders by increasing the share price in they will invest it in companies able to put it to good use. 


     

    It’s Apple’s money. Who are you to say what use the thousands of shareholders will put it? Who are you to say that use is better than Apple’s?

     

    Tim is a great leader and Carl says so repeatedly but this is a finance thing unrelated to the running of the company. 


     

    Right, which is why Apple ignores it so handily.

     

    Also think how it would reward Apple staff, they deserve it. 


     

    Appeals to pity and even poverty, I think. Doesn’t work.

     

    It will make future hiring much easier. 


     

    In what possible way?

  • Reply 84 of 92
    You’ve completely lost it.

    No, it doesn’t.

    It’s Apple’s money. Who are you to say what use the thousands of shareholders will put it? Who are you to say that use is better than Apple’s?

    Right, which is why Apple ignores it so handily.

    Appeals to pity and even poverty, I think. Doesn’t work.

    In what possible way?

    Right on, TS. We live in the age of the entitled. It's disturbing how uninformed people have become. Businesses exist to make a profit, not as a means to hand out jobs or freebies to beggars and whiners. Good lord.
  • Reply 85 of 92
    crowleycrowley Posts: 10,453member
    What is the point in profit if it doesn't end up with the employees or the shareholders? Should Apple just keep building their money pile until they have all the money in the world?
  • Reply 86 of 92
    Originally Posted by Crowley View Post

    What is the point in profit if it doesn't end up with the employees or the shareholders?

     

    How does making billions of dollars in profit every quarter not inherently end up with employees (pay, plus raises, corporate expansion, new hires, etc.) and shareholders?

     

    Should Apple just keep building their money pile until they have all the money in the world?


     

    Sounds good to me. At least we know they’re capable of managing it without being idiots.

  • Reply 87 of 92
    crowleycrowley Posts: 10,453member
    Quote:
    Originally Posted by Tallest Skil View Post

     

     

    How does making billions of dollars in profit every quarter not inherently end up with employees (pay, plus raises, corporate expansion, new hires, etc.) and shareholders?


    Err... because Apple have $150b banked and aren't showing much inclination towards using it for any of those things?

     

    Most of those things are counted in company outlay anyway, so wouldn't be a normal use for profits.

     

    Quote:
    Originally Posted by Tallest Skil View Post

     

    Sounds good to me. At least we know they’re capable of managing it without being idiots.


     

    Apple employees and shareholders are idiots with their money?  Apple scraping a measly amount of interest off of securities is good cash management? 

     

    Gonna need to see some kind of justification behind that buddy.

  • Reply 88 of 92
    Originally Posted by Crowley View Post

    Err... because Apple have $150b banked and aren't showing much inclination towards using it for any of those things?

     

    Yeah, they’re sure not building a new campus or hiring anyone else, that’s for sure.

     

    Apple employees and shareholders are idiots with their money? 


     

    No, Icahn excluded. I mean the global financial market as a whole. Apologies for the confusion; you’re right.

  • Reply 89 of 92
    crowleycrowley Posts: 10,453member
    Quote:
    Originally Posted by Tallest Skil View Post

     

    building a new campus


    $5b is the commonly stated figure, and there's speculation that they are $2b over budget.

     

    Quote:
    Originally Posted by Tallest Skil View Post

     

    hiring


    According to Apple they employed 5,000 more people in the USA in 2012.  I can't find any worldwide figures or figures for 2013, but since the bulk of Apple Corporate and about half of Apple retail is in the USA, let's assume that a simila rnumber was created outside the USA, so 10,000 total.  Average wage?  Well that number includes retail through to execs, but let's be generous again and assume $150k/y.  10,000 x $150k is an increased wage bill of $1.5b.  My guesses are bound to be out by a chunk, and the numbers are a year out, so let's quadruple that to be safe, to $6bn.

     

     

    $7bn on campus (actually spread over a number of years, but nevermind that), and $6bn in new salaries, so $13bn in total (very generously).

     

    In case you didn't notice, Apple made pretty much $13bn in this quarter alone.  So they have three more quarters of just piling on the money.

  • Reply 90 of 92

    Thanks for the rundowns. They’re neat!

     

    Originally Posted by Crowley View Post

    In case you didn't notice, Apple made pretty much $13bn in this quarter alone.  So they have three more quarters of just piling on the money.


     

    And… so? After his return in 1996, Steve repeatedly said, for years, that he runs Apple as a startup. Runs it as though every dollar is their last. 

     

    It’s the right way to work. “It’s bad for a company to have money saved away” is a statement that no one in finance should legally be allowed to make. At least, not if they want to stay working in finance. Apple isn’t evil for keeping money.

  • Reply 91 of 92
    crowleycrowley Posts: 10,453member

    Arguable.  Money is the blood of an economy, so if Apple are holding it in a way that is restricting it from flowing they're a clot in the economy.  Clots are good temporary solutions if a part of your body needs healing, but that's not the case with Apple.

     

    Why is it "the right way to work"?  Apple aren't benefitting a great deal from it, their money is gaining so little interest you could call it dust.  Apple are a healthy company raking in record profits year after year, they don't need to keep such a stash as security any more.  In the late 90s and early 00s under Steve Jobs it was reasonable for them to save as much as they could for a rainy day, but now it's excessive and time for a rethink.  I'd say that's been the case ever since the success of the iPhone became apparent to the wider world.  Obviously Apple are thinking some of the thoughts since there's already a buyback in place, but despite the scale of it, it actually seems quite conservative since they managed to finance it all out of short term debt to be repaid from regular cashflows - (possibly) interesting point, this quarter's numbers having "flatlined" profits may be down to interest on the debt incurred from that buyback, but are also why EPS increased.

     

    Also, I think that quote might be a bit redundant.  Startups don't spend $5bn on environmentally sustainable glass campuses shaped like UFOs.  I'm not sure it was ever particularly true, Steve was a master bullshitter.

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