Apple's $76 Billion Question: What to Do With the Cash?

Apple's $76 Billion Question: What to Do With the Cash?Apple (AAPL) announced its quarterly earnings Tuesday, and -- big surprise -- they were stellar. But one of the numbers not discussed much in analysis of its results was the more than $76 billion Apple holds on its balance sheet. This includes $12.1 billion in cash and cash equivalents, $16.3 billion in marketable securities, and $47.8 billion in long-term marketable securities. More remarkable still is that, based on Apple's earnings, that figure could reach $100 billion by year's end -- after all, the upcoming two quarters include back-to-school and the holiday season.

What Apple will do with all of that money has been discussed for two or three years as the balance has grown. Apple has made few acquisitions of any size. Its stock rose to near $400 after it released results. With a market cap in excess of $360 billion, it could easily use its stock as currency if it wanted to purchase of another large company.

But which company? There seem to be few appropriate targets. Apple doesn't need to buy another handset or PC maker. It's too successful to buy competitors who already do poorly compared to it. Apple can hardly buy its major rival, Google (GOOG), which has a market value of $195 billion. There might be some value in capturing its search business, and the Android mobile OS which is Apple's only real competitor in that arena -- but Apple has already stated publicly that it does not want to be in the search business. Other fast-growing Internet companies like Facebook, Groupon, or Twitter wouldn't seem to be of any use to Apple.

Apple has enough power with investors to ward off any pressure to distribute the cash to shareholders. It can argue that its stock is up nearly 60% in the last year. What more could investors want?

Every time the company releases its quarterly earnings, the press and Wall Street will continue to ask what Apple will do with its ever growing stash of cash. And Apple will continue to deflect the question and leave everyone guessing.

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ieyun313

When you buy from the charity, I paid them anyway, but something that you think or say what a good price if the quality is fine magnetic silver zinger? What are you looking for when buying magnetic silver zinger?
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August 26 2011 at 2:33 AM Report abuse rate up rate down Reply
Josh Schermer

Buy Hulu!

July 28 2011 at 7:52 PM Report abuse rate up rate down Reply
dunlapjackie

I could use $50,000. How about sending me some cash. Banks are not lending and can't sell my house.

July 25 2011 at 11:36 AM Report abuse rate up rate down Reply
krymstopr

How's this..... Give every shareholder a million dollar one time dividend check. Hey steve Christmas is coming you know! Lolol

July 23 2011 at 9:54 PM Report abuse rate up rate down Reply
mmcdonald2k

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July 23 2011 at 12:14 AM Report abuse rate up rate down Reply
mmcdonald2k

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July 23 2011 at 12:10 AM Report abuse rate up rate down Reply
elnora11

give the shareholders a large one time dividend. also why not split the stock say 5 to 1 . et williams

July 21 2011 at 10:04 AM Report abuse rate up rate down Reply
bjw367

What to do??? Stop making everything in China and as was mentioned below...bring back jobs to the USA!!!!!

July 20 2011 at 11:30 PM Report abuse rate up rate down Reply
ksmd112

Ship a truck load of $50's to Obama. He can create some "programs" to give that cash to people that don't have it, want it, need it, and would spend it in the "community".......

July 20 2011 at 4:17 PM Report abuse rate up rate down Reply
mbzmc

Bring the manufacturing to the U.S! So what if Apple makes a few billion less per year. The U.S. government should make a special ruling for Apple to bring the manufacturing here.....No unions-ever could infiltrate an Apple plant. If Apple could be guaranteed union free shops that may make it more attractive to open up here in the U.S.A. Also lower the corporate tax. This country is too anti-business and is going down the tubes! Ok Steve Jobs-does that work for you? No unions, lower taxes and think how proud you could be with "MADE IN THE USA" stamped on each product.

July 20 2011 at 3:15 PM Report abuse rate up rate down Reply