Tim Cook "Not Religious" About Holding Cash; 66% of Apple's $81B in Cash is Held Overseas

It's a frequent parlor game amongst Apple analysts and watchers to guess and suggest and hypothesize what Apple should do with its huge and growing cash reserves. As of September 24, 2011, Apple is sitting on $81.57 billion in cash. Apple added $5.4 billion to its cash reserves in the last 3 months, and that would have been significantly higher if, as Horace Dediu points out, not for the more than 6,000 Nortel patents Apple purchased the rights to.

To be more precise, Apple CFO Peter Oppenheimer oversees $9.815 billion in cash and cash equivalents, $16.137 billion in short-term marketable securities, and $55.618 billion in long-term marketable securities. In the earnings call with analysts this afternoon, Apple CEO Tim Cook said the cash wasn't "burning a hole in our pocket" and that the company invested very conservatively and didn't want to do "silly things" with the money.

pudong
Cook noted that in recent months Apple had acquired several companies, acquired intellectual property, invested in the supply chain, and invested in new stores. In his first comments as CEO about the cash pile Cook said he wasn't "religious about holding or not holding cash," but Apple would continually ask ourselves what is in Apple's best interest and act accordingly.

"It's a topic for the board on an ongoing basis and we will continue to discuss it," Cook said in response to an analyst question. Apple CFO Peter Oppenheimer jumped in after Cook was finished answering the question, to point out that more than two-thirds of Apple's $81 billion cash pile was sitting offshore.

The question of offshore cash is an important one, as explained by Reuters:

The U.S. government taxes U.S. businesses on income earned worldwide, but allows them to defer taxes on the money until it is brought back to the United States. As a result, American corporations like to keep the money abroad, particularly as they increase investment overseas.

A number of companies, led by Apple, Google and Cisco have been pushing for a tax holiday on overseas cash holdings to allow the companies to repatriate the money to the United States tax-free.

Top Rated Comments

hobo.hopkins Avatar
158 months ago
It's too bad that the American tax system incentivises not bringing the money back into the United States.
Score: 23 Votes (Like | Disagree)
42streetsdown Avatar
158 months ago
They could spend some of that on building an apple store closer to me.
Score: 17 Votes (Like | Disagree)
hobo.hopkins Avatar
158 months ago
So you would rather they not pay taxes on earnings?

Did I say that? I just said that it's a shame that the tax system doesn't incentivise bringing back money from overseas. Incentives could be a temporary lower rate to provide instant benefits, for example. I didn't say they shouldn't pay any taxes; I believe that's creating a false dilemma.
Score: 12 Votes (Like | Disagree)
Robbrinson Avatar
158 months ago
Why pay the 12 big ones to our Govt? They will just stimulate a few ill conceived green energy initiatives, bail out a bank, or get a new campaign bus from Canada (sorry McFrankshe). Just use it to delevop a smaller iPad.
Score: 7 Votes (Like | Disagree)
Juan007 Avatar
158 months ago
All of this money was earned overseas, ex. China sales. Why should Apple pay US tax for goods made and sold in China? The net effect is that the money stays offshore and never gets invested back into the US. A disaster of a tax system.
Score: 7 Votes (Like | Disagree)
TheMirrorsTruth Avatar
158 months ago
Funny how the U.S. can tax revenue that never actually existed in the U.S. Gotta love "repatriation!"
Score: 7 Votes (Like | Disagree)

Popular Stories

iOS 17

26 New Things Your iPhone Can Do With Next Month's iOS 17.2 Update

Wednesday November 22, 2023 10:57 pm PST by
Apple made the first beta of iOS 17.2 available to developers in October. Since then we've seen two more betas, and with each iteration Apple continues to add more new features and changes, many of which users have been anticipating for quite a while. Below, we've listed 26 new things that are coming to your iPhone when the finalized version is publicly released in December. 1. Help You...
Apple Watch Series 9

5 Reasons to Wait for Next Year's Apple Watch

Friday November 24, 2023 3:46 am PST by
With all the discounted deals on Apple tech currently available, you might be thinking about upgrading your Apple Watch or buying one for the first time. But if your current smartwatch is doing its job just fine and it's only the idea of a good deal that's piqued your interest, it could be worth holding out until next year when Apple unveils its latest and greatest version. There are already ...
General Black Friday Deals 2022 Green

40+ Apple Black Friday Deals Still Available for AirPods, iPhone, iPad and More

Friday November 24, 2023 5:01 am PST by
Black Friday 2023 has officially ended, but we're still tracking some of the best deals of the year on Apple products like AirPods, iPad, iPhone, MacBook, and many more. Note: MacRumors is an affiliate partner with some of these vendors. When you click a link and make a purchase, we may receive a small payment, which helps us keep the site running. Specifically, in this article we're...
Cyber Monday Deals Feature 2022

40+ Apple Cyber Monday Deals for AirPods, iPad, Apple Watch, and More

Sunday November 26, 2023 9:47 am PST by
Cyber Monday has taken the place of Black Friday, and you'll find many of the same deals still around today. This includes dozens of record low prices on Apple products like AirPods, iPad, Apple Watch, MacBook, iPhone, and more. Note: MacRumors is an affiliate partner with some of these vendors. When you click a link and make a purchase, we may receive a small payment, which helps us keep the...
ipad mini 2021 youtube

What to Expect From the Next iPad Mini Later in 2024

Friday November 24, 2023 1:00 pm PST by
Over 800 days have passed since Apple last updated the iPad mini, as outlined in the MacRumors Buyer's Guide. Fortunately, a new iPad mini is rumored to be released next year, and we have outlined what to expect from the device below. Apple released the current iPad mini in September 2021, with new features at the time including a larger 8.3-inch display, a USB-C port, a Touch ID power...