“I am a big fan of both Apple and Tim Cook,” Eric Jackson writes for Forbes. “However, I do have a big problem with one choice Cook has made over his tenure as CEO of Apple. It’s not the lack of a bigger screen iPhone sooner or his original choice of head of Apple Retail before Angela Ahrendts. It’s his decision to spend $100 billion and counting of Apple cash on a capital return program.”
“To date, it’s been estimated that Apple has used more than $100 billion of its cash on dividends and stock buybacks. To me, that’s madness,” Jackson writes. “I believe the capital return program has been a total waste of Apple’s hard-earned $100 billion. I believe – although this is impossible to prove – that Apple’s stock price would be just as high as it is today (or more likely higher) had they spent that $100 billion on a combination of smart M&A and smart R&D that would have continued to extend Apple’s lead over other Android phone makers.”
“Apple could have a quarter of a trillion dollars today in cash to put to work today. They could become the overnight leader in smart cars by buying Tesla. They could – more importantly – acquire our generation’s single greatest technological leader in Elon Musk and give him carte blanche to paint his canvas. (Somehow, I think Musk could find a better use of $100 billion than handing it over to shareholders),” Jackson writes. “They could acquire the single most unique and intriguing asset in the social networking world today in Twitter which, despite the recent management criticisms, is only going to be more important to our culture moving forward. They could acquire the single greatest threat to Google search in the last 15 years by buying Pinterest.”
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