Apple to buy back shares and pay first dividend since 1995
After years of failing to persuade its founder Steve Jobs to return cash to shareholders, Apple's investors finally got their way yesterday as the company said it would resume paying dividends for the first time since 1995 and buy back $10bn (£6bn) of its shares.
Huge demand for its iPhones and iPads has left Apple sitting on nearly $100bn of cash – money Mr Jobs thought should be kept in the company to reinvest in new inventions and developments, but which investors believed should be, at least in part, given to them.
The world's most valuable company yesterday said it would pay a quarterly dividend of $2.65 a share starting in July.
It will then use part of its cash to buy back shares from investors over the next three years.
"We have used some of our cash to make great investments in our business through increased research and development, acquisitions, new retail store openings, strategic pre-payments and capital expenditures in our supply chain, and building out our infrastructure," said its chief executive, Tim Cook. "You'll see more of all of these in the future."
He added that the company would retain a "war chest" for other opportunities, saying of the cash returns: "These decisions will not close any doors for us."
Shares in the group leapt $10 in afternoon trade to $595.58 as investors welcomed the news.
In addition to allowing investors to cash in some of the company's gains, the dividend will allow many more funds to buy into Apple's shares, as several major investment businesses are not allowed to back companies which do not pay one.
Apple's chief financial officer, Peter Oppenheimer, said: "We are extremely confident in our future and see tremendous opportunities ahead." He set the regular quarterly dividend at $2.65 a share, which will cost Apple about $10bn a year.
- 1 To help fuel their propaganda machine against the poor, our government has now decided to redefine the word 'welfare'
- 2 Anti-gay hate preacher accidentally tweets 4,000 followers cartoon clip of him 'confessing' to be a 'homosexual sodomite'
- 3 Woman opens professional cuddling shop – gets 10,000 customers in first week
- 4 Grayson Perry: London needs affordable housing because 'rich people don't create culture'
- 5 Kenya bus attack: Al-Shabaab militants kill 28 non-Muslims who failed to recite Koran
Ryan Gosling granted temporary restraining order against a woman 'convinced she was his twin flame'
Jennifer Lawrence sings in new The Hunger Games: Mockingjay Pt 1 clip on YouTube
Anti-gay hate preacher accidentally tweets 4,000 followers cartoon clip of him 'confessing' to be a 'homosexual sodomite'
Woman opens professional cuddling shop – gets 10,000 customers in first week
Grayson Perry: London needs affordable housing because 'rich people don't create culture'
Rochester by-election: Ukip gains second MP as Tory defector Mark Reckless holds seat
'Beast of Bolsover' Dennis Skinner takes Ukip MP Mark Reckless to task moments after he is sworn in
Rochester by-election: Labour MP Emily Thornberry resigns after posting white van and England flags tweet
France 'blocks' Russian sailors from boarding a warship
Revealed: How the world gets rich – from privatising British public services
Myleene Klass: Ed Miliband 'strikes back' by comparing UK's need for Labour's mansion tax to Hear'Say track
iJobs Money & Business
Voluntary Only - Expenses Reimbursed: Reach Volunteering: Age Concern Slough a...
Voluntary Only - Expenses Reimbursed: Reach Volunteering: Crossroads Care is s...
£20000 - £25000 per annum + OTE £35,000: SThree: We consistently strive to be ...
£50000 - £90000 per annum + benefits: Ampersand Consulting LLP: Markit EDM (CA...