Apple today reported that profits slipped slightly, but sales grew despite the economic disruptions caused by reactions to the global COVID-19 pandemic. The company promised shareholders billions more in stock repurchases and increased dividends.
The company topped earnings and revenue expectations for the March quarter, led by a significant beat by the services segment, but Apple declined to give a forecast for the current quarter due to COVID-19 uncertainties.
Apple also announced that it would be boosting its buyback program by $50 billion, though this was a smaller increase than the $75 billion and $100 billion that it added to the program in 2019 and 2018, respectively.
The iPhone maker posted fiscal second-quarter net income of $11.25 billion, or $2.55 a share, down slightly from $11.56 billion, or $2.46 a share, a year prior, but easily higher than estimates as the FactSet consensus modeled $2.24 a share. Apple’s total revenue grew slightly to $58.31 billion from $58.02 billion, while analysts were expecting $54.78 billion.
As part of its annual capital-return update, Apple announced it would also increase its quarterly dividend by 6% to 82 cents a share. The company upped its dividend 5% in 2019 and 16% in 2018.
MacDailyNews Take: In today’s conference call, Apple CFO, Luca Maestri said there was still some $40 billion remaining from the last capital return program authorization, so add that to the new $50 billion in buybacks announced today. That makes for quite a sizable share repurchase program that will benefit Apple shareholders along with the dividend raise.
0.82 * 4 = $3.28 per share annual. Just over 1% return as the current share price cost.
The dividend is decent but I was hoping for about $0.85 a share. I’ll survive, for sure. $50B buyback is more than enough but I keep thinking all the businesses or the one big business Apple could acquire for that amount that Wall Street might appreciate. That been said, I’m glad I own Apple and the past quarter was simply a temporary setback for a fine company. Just about everything turned out as I expected and Apple’s share price did drop a bit after hours, but nothing huge.
I’ll be so glad when the virus crisis is behind us. NYC is a real mess. Now they’re shutting down the subway from 1:00 AM to 5:00 AM for disinfecting and stopping the homeless from taking over the seats all night. They’re also providing alternative means of travel during those hours for essential job riders to get home. Unprecedented in NYC. It’s a ghost town at night (and day) and it seems so strange to see.
Quite frankly, they can drop the amount they use for buybacks and deliver the 10% dividend increase they have given us most years. Last year’s 5% was an embarrassment, as is this year’s 6%. If they want to become revenue neutral, then instead of buying so much stock, they should begin paying off some of that massive $110 billion in debt they acquired for that purpose.
The hired hand managers are making to much money in stock options. I hate stock buybacks, but the new wave loves them.
Wtf, there was $40 billion left from the previous buyback? AAPL got as low as $220 recently, they should have dropped the entire amount around there. What a buy! (I bought some around that time)