Legal News

Apple Walks the Talk: Initiates Huge Corporate Cash Payout
Download PDF
1 Star2 Stars3 Stars4 Stars5 Stars (No Ratings Yet)

While speculations about the comments on possible buybacks and dividends by Apple CEO Tim Cook had seen Apple’s shares doing better than ever, many were skeptical that these were just ploys to set the market abuzz and the shares roaring. However, Apple CEO Tim Cook has created one of those rare instances where a big corporate actually walks the talk, and has announced that the company would start paying its first dividends since 1995. The move consists of regular quarterly payouts of $2.65 a share starting in July and a buyback of $10 billion would start from the next fiscal year.

However, criticisms of the move are already being made. Fund managers allege that the meager size of the 1.8 percent dividend versus a $98 billion cash hoard does not meet Standard & Poor’s 500 average.

The announcement came with Apple celebrating sales of 3 million of the latest iPads on Monday.


Tim Cook, as the new Apple CEO has been appreciated for many of his actions not limited to investigations into allegations of labor abuse in Apple’s supply chain. Also, departing from Apple’s tradition, Cook addressed investors directly at the Goldman Sachs conference.

The market reaction has been one of increasing trust. Connor Browne of Thornburg Value Fund told the Reuters that “Already we are seeing more openness, and more willingness to address issues on many different fronts under Tim Cook than we had seen in the past.”

While under Steve Jobs, the company focused on maintaining a huge war chest as one of its resource policies, Cooks holds that capital preservation was not of such outstanding importance as to create a stagnant cash hoard and keep sitting upon it. Contrary to the era of Jobs, when dividends ware often hinted at but never actualized, Cook has broken the tradition of more than a decade by agreeing the share the cash pile.

Get JD Journal in Your Mail

Subscribe to our FREE daily news alerts and get the latest updates on the most happening events in the legal, business, and celebrity world. You also get your daily dose of humor and entertainment!!

Addressing fears that his style of management would dampen the company’s competitive edge, Tim Cook told the media in a rare conference call, “Innovation is the most important objective at Apple and we will not lose sight of that.”

However, as experts see it, one of the key drivers for Steve Jobs’ insistence upon creating and maintaining a cash pile is that the company has meager recurring revenues and new sales drive the company. If at any critical moment, a project failed to bring in the desired sales, the only defense without making allowances to market pressures would have been a large company war chest.

That Tim Cook is departing from this strategy has made experts speculate that Apple might be poised for products that would ensure recurring revenues and do away with the overwhelming importance of a cash hoard.



Litigation Attorney


Our thirty-two-lawyer litigation firm is seeking a litigation lawyer to become part of the team. The...

Apply now

Legal Assistant


Our thirty-two-lawyer litigation firm is seeking a legal secretary to become part of the team. The f...

Apply now



Our thirty-two-lawyer litigation firm is seeking a paralegal to become part of the team. The firm ha...

Apply now

Full-time Family Law Attorney (s)

USA-PA-Camp Hill

Boutique family law firm in Central Pennsylvania is seeking 1 or more associate attorneys interested...

Apply now




Search Now

International Trust and Estates Attorney

USA-NY-New York City

New York City office of a BCG Attorney Search Top Ranked Law Firm seeks an international trust and e...

Apply Now

Real Estate Attorney

USA-NY-New York City

New York City office of a BCG Attorney Search Top Ranked Law Firm seeks a Real Estate Attorney with ...

Apply Now

Litigation Associate Attorney

USA-CA-Los Angeles

Los Angeles office of a BCG Attorney Search Top Ranked Law Firm seeks a litigation associate attorne...

Apply Now


To Top