Apple CEO Tim Cook Unveils Dividend, Stock Buyback to Reward Investors With $45 Billion Over Three Years

Tim Cook Apple CEO - P 2011
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UPDATED: The tech giant finally answered investor questions about how it would put its nearly $100 billion in cash to use and said that iPad 3 sales led to a record weekend for the company.

NEW YORK - Apple, long known for hoarding cash, said Monday morning that it will spend $45 billion over three years on rewarding shareholders with some of its nearly $100 billion in cash currently.

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CEO Tim Cook unveiled a $2.65 per share dividend, starting in the third quarter of calendar year 2012, and a $10 billion stock buyback over three years. Apple previously paid dividends from June 1987 to Dec. 1995.

“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 prepayments and capital expenditures in our supply chain, and building out our infrastructure,” Cook said. “You’ll see more of all of these in the future. Even with these investments, we can maintain a war chest for strategic opportunities and have plenty of cash to run our business.”

Investors have long been looking for guidance on how the tech giant would use its big and growing pile of cash for shareholders' benefits. Apple has in the past said it needs big cash reserves to ensure it can keep bringing in supplies and continue to make its popular devices.
The Cupertino, Calif.-based company had on late Sunday announced a Monday morning conference call with Cook and CFO Peter Oppenheimer.

As of the end of 2011, Apple had cash, cash equivalents and marketable securities worth $97.6 billion.

At Apple's recent shareholder meeting, Cook had said that the company has been considering  "very deeply" how to put its cash to use, acknowledging that it was moe to what it needed to finance its operations.

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On his conference call Monday, Cook emphasized "how confident we feel about Apple's future." He also vowed that the company would remain financially disciplined, saying that innovation remains the company's "most important objective."

Asked about early iPad 3 sales, Cook said the firm had "a record weekend, and we are thrilled with it," but he didn't provide specifics.

Apple's stock was up 1.5 percent in early trading at $594.49. It has traded between $310.50 and $600.01 over  the past year.


Twitter: @georgszalai