Apple plans to buy back an additional $30 billion of its stock, raise its quarterly dividend by 8 percent and split its stock for the first time in nine years.
The commitment announced Wednesday as part of Apple’s fiscal second-quarter earnings report expands on the company’s previous pledge to spend $60 billion on stock buybacks by the end of next year. The company is now earmarking $90 billion for buybacks during that time frame.
Apple also is raising its quarterly dividend to $3.29 per share as part its effort to funnel more money to stockholders.
The company also will execute an unusual seven-for-one stock split in early June. The move will dramatically decrease the nominal value of Apple’s stock, which closed Wednesday at $524.75. The shares soared by more than 7 percent after the news came out.
The slowdown in revenue growth has prompted investors to wonder whether the company has lost its innovative power since the death of Steve Jobs. The buybacks will increase the price of remaining shares because there are fewer outstanding.
The results for the first three months of the year illustrated how Apple Inc. can afford to spend so much money on its own stock.
Apple’s earnings rose 7 percent to $10.2 billion, or $11.62 per share, an amount that exceeds what most technology companies make in an entire year. Revenue climbed by 5 percent to $45.6 billion.
Associated Press
