Apple’s post-Jobs chief Tim Cook announced that some of the company’s mountain of cash will be used to pay a dividend to shareholders and initiate a US$10 billion share buyback scheme.
The move makes a break from the policy of famously tight Steve Jobs that refused to discuss the prospect of sharing profits with shareholders, despite record profits.
Apple will now return US$45 billion to holders of Apple stock and marks the first payment of a dividend since Apple’s lean times in the mid 1990s. Cook said that the payout still meant the company had a sizable war chest for "strategic opportunities" read acquisitions.
The payment of a dividend also makes Apple stock more attractive for institutional investors that typically require a dividend in order to hold onto stock. "We hope it will broaden the investor base to attract new investors who don’t currently have Apple stock," Cook said.
Such is the size of the dividend that Apple will end up forking out just under $10 billion every year and will make the firm one of the highest dividend paying firms in the US.
No doubt this will propel the stock to even further heady heights than the current $600 price tag, already making Apple the most valuable publicly traded company in the world.