“The biggest cash pile in the technology industry historically has belonged to Microsoft Corp., but now it has some company, and it’s a familiar name: Apple Inc.,” Todd Bishop reports for The Seattle Post-Intelligencer.
“Microsoft has reduced its cash balance to $26.3 billion through large stock buybacks, dividends and acquisitions. The balance was more than $64 billion less than four years ago,” Bishop reports. “Apple’s balance has been growing – reaching $19.4 billion at last count – as a result of the cash generated by its Mac and iPod lines. Less than four years ago, its stockpile was $5.5 billion.”
“The trends have implications for both companies. Cash translates into the ability to consider acquisitions and other potentially business-boosting deals. Apple has cited those types of possibilities when Wall Street analysts have asked about plans for its cash. Microsoft had been planning to borrow money for the first time, before it withdrew its $44.6 billion Yahoo bid Saturday,” Bishop reports.
“‘Stock buyback programs and other forms of returning the cash are discussed with the board from time to time,’ said Peter Oppenheimer, Apple’s chief financial officer, in a Jan. 22 earnings conference call. But Apple’s current preference is to ‘maintain a strong balance sheet in order to preserve our flexibility to make strategic investments and/or acquisitions,’ he added,” Bishop reports.
More in the full article here.