Date
21 July 2017
More than 90 percent of Apple's cash hoard is stockpiled outside of the US. Photo: WSJ
More than 90 percent of Apple's cash hoard is stockpiled outside of the US. Photo: WSJ

Apple’s cash hoard set to top US$250 bln

Apple Inc. is expected to report that its stockpile of cash has topped a quarter of a trillion dollars, an unrivaled hoard that is greater than the market value of either Wal-Mart Stores Inc. or Procter & Gamble Co. and exceeds the foreign-currency reserves held by the UK and Canada combined, the Wall Street Journal reports.

The money, more than 90 percent of which is stockpiled outside of the U.S., has drawn fresh attention as President Donald Trump has proposed slashing business taxes and granting a one-time tax holiday on corporate cash brought home.

Those policies could ratchet up pressure on the tech giant to dole out more money to shareholders or make splashy acquisitions.

Apple’s quarterly results will show the company has doubled its cash in just over 4½ years. In the last three months of 2016, it racked up cash at a rate of about US$3.6 million an hour.

As of December, the company had US$246.09 billion total cash, cash equivalents, and securities. Apple, like many big American companies, parks most of that cash offshore rather than paying US taxes on its overseas profits.

Apple chief executive Tim Cook early this year said he was eager to bring cash home if tax changes enabled it. Chief financial officer Luca Maestri said such a move would give Apple flexibility to do more capital returns. Neither has given detailed plans.

One possible approach would be a special dividend. Apple could deliver such a windfall, benefiting investors including Warren Buffett’s Berkshire Hathaway Inc., which more than doubled its Apple position in January to about 2.5 percent.

Wall Street analysts tend to focus more on companies’ net cash position than the headline number. Since 2012, Apple has gathered some US$88 billion in debt to fund payouts to shareholders. But even subtracting that, Apple would be left with more cash than the total stockpile of Microsoft Corp., the next richest tech company, which has US$126 billion in cash, not accounting for debt. 

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