Apple Board Has Been "Considering" Dividends and Buybacks Since 2005

152823 apple logoMuch has been made of the recent comment by Apple CEO Tim Cook that the Apple board of directors has been "actively discussing" what to do with its enormous cash pile. Some see it as a sign that Apple will soon pay a dividend or initiate a share buyback program -- except Apple's board has been discussing what to do with its cash for nearly 7 years.

MacRumors went through Seeking Alpha's entire Apple earnings call transcript history to find out what Apple has been saying about the likelihood of a dividend. Between July of 2005 and October of 2010, Apple execs had very little to say about what Apple was going to do with its burgeoning cash pile -- a pile that grew from $7.5 billion to $51 billion over that time.

July 2005 was the earliest transcript, and the first time an Apple exec said that the board "from time to time" considered its options for the use of Apple's cash. CFO Peter Oppenheimer on July 13, 2005:

I don’t have a change in our philosophy that I can share with you today. We are maintaining our cash for flexibility to invest in the business and share buyback are considered with the Board from time to time.

Then-COO Tim Cook used the same phrasing on April 20, 2006:

Regarding our use of cash, we are continuing to be conservative with the cash, despite some of the investments we made this quarter. We’re wanting to retain it for flexibility to invest in the business. We do discuss with the board from time to time share buyback, but don't have a change in philosophy to discuss with you today.

Finally, after twelve conference calls during which Apple's cash pile was discussed and the phrase "from time to time" used on six separate occasions, CEO Steve Jobs appeared on October 18, 2010 and laid out a more detailed vision for Apple's investment strategy:

We strongly believe that one or more very strategic opportunities may come along that we're in a unique position to take advantage of because of our strong cash position. And I think we've demonstrated a really strong track record of being very disciplined with the use of our cash. We don't let it burn a hole in our pocket, we don't allow it to motivate us to do stupid acquisitions.

And so I think that we'd like to continue to keep our powder dry because we do feel that there are one or more strategic opportunities in the future. That's the biggest reason. And there are other reasons as well that we could go into. But that's the biggest one.

Newly appointed Apple CEO Tim Cook expanded on Jobs' thoughts a year later, perhaps indicating a more flexible approach to disclosure and Apple's use of cash. October 18, 2011:

I believe what we're doing with cash, the way we're -- this cash that we do spend we're doing an extremely good job of it and we're very frugal about using it and using it in the right places. That said, I'm not religious about holding cash or not holding it. I'm religious about a lot of things but not that one. And so we will continually ask ourselves what's in Apple's best interest and always do what we believe is in Apple's best interest. And so it's a topic for the board on an ongoing basis, and we'll continue to discuss it.

With Apple nearing $100 billion in cash, COO Peter Oppenheimer addressed the issue again on January 24 of this year, during the introductory remarks and the Q&A session when he answered four separate questions about cash:

We have always discussed, internally as a management team and with our board, our cash. We recognize that the cash is growing for all the right reasons and I would characterize our discussions today as active about what makes the most sense to do with the cash balance, but we don't have anything to announce specifically today.

[...]

We're examining all uses of our cash balance, what we might do in the supply chain, what we can do from an acquisition perspective and otherwise. Since I don't have any perspective to share with you today, specifically on dividends or buybacks, other than again, we are actively discussing the cash balance. And in the meantime, we're not letting it burn a hole in our pockets.

Analysts have inquired about Apple's cash plans for more than half a decade, and Apple, as it is wont to do, has said very little of substance. Apple execs have consistently said that they have "nothing to share" and that "it's a topic for the board on an ongoing basis".

This may be changing, however -- a UBS research report noted that the Apple board's ongoing discussions may be progressing slightly. UBS's Bob Faulkner writes "We ... understand that management has been soliciting the opinions of large shareholders on the subject [of paying a dividend]." If this is true, it is a significant shift in direction for the company.

That said, Apple has been growing its sales and profits like no other company in the world. Some may feel that, as the adage goes, if it ain't broke, don't fix it. Perhaps the board's ongoing discussions will finally come to some sort of a conclusion, but no one should be surprised if they don't.

The full list of quotes and links to earnings call transcripts is available. Transcripts courtesy Seeking Alpha.

Popular Stories

iPhone 17 Air Pastel Feature

iPhone 17 Air Battery Capacity and Weight Allegedly Revealed

Monday May 19, 2025 2:22 am PDT by
Apple is expected to launch an all-new ultra-thin iPhone 17 Air later this year, and while there have been plenty of rumors about the camera's overall design and thinness, we haven't heard any details about the device's weight and battery capacity until now. According to the leaker going by the account name "yeux1122" on the Korean-langauge Naver blog, the 6.6-inch iPhone 17 Air has a weight ...
Apple CarPlay Ultra instrument cluster themes 01

Apple's CarPlay Ultra Is Here – Does Your iPhone Support It?

Thursday May 15, 2025 5:17 am PDT by
Apple's recently announced CarPlay Ultra promises a deeply integrated in-car experience, but not all iPhone users will be able to take advantage of the new feature. According to Apple's press release, CarPlay Ultra requires an iPhone 12 or later running iOS 18.5 or later. This means if you're using an iPhone 11, iPhone XR, or any older model, you'll need to upgrade your device to access...
Apple Glass

Apple Smart Glasses: Everything We Know So Far

Wednesday May 21, 2025 8:21 am PDT by
Google made waves yesterday by showcasing a set of lightweight smart glasses featuring deep Gemini integration and an optional in-lens display. The demo has reignited interest in Apple's own smart glasses project, which has been the subject of rumors for nearly a decade. Here's a recap of where things stand. Current Development Status Apple is actively working on new chips specifically...
Apple CarPlay Ultra instrument cluster themes 01

Apple's 'CarPlay Ultra' Experience Now Available

Thursday May 15, 2025 5:07 am PDT by
Apple today announced that its next-generation CarPlay experience, now dubbed "CarPlay Ultra" begins rolling out today, starting with Aston Martin vehicles. Subscribe to the MacRumors YouTube channel for more videos. CarPlay Ultra is now available with new Aston Martin vehicle orders in the U.S. and Canada. It will also be available for existing models that feature the brand's next-generation ...
WWDC 2025 Banner

Apple Announces WWDC 2025 Schedule, Including Keynote Time

Tuesday May 20, 2025 8:13 am PDT by
Apple today announced a more detailed schedule for its annual developers conference WWDC, which runs from June 9 through June 13. The schedule confirms that Apple's keynote will begin on Monday, June 9 at 10 a.m. Pacific Time, with a live stream to be available on Apple.com, in the Apple TV app, and on YouTube. During the keynote, Apple is expected to announce iOS 19, iPadOS 19, macOS 16,...
macOS 16 visionOS Inspired Feature 1

macOS 16: Everything We Know So Far

Tuesday May 20, 2025 7:31 am PDT by
The Worldwide Developers Conference (WWDC), Apple's annual developer and software-oriented event, is less than three weeks away. We haven't heard a great deal about macOS 16 ahead of its announcement this year, so we could be in for some major surprises when June 9 rolls around. Here's what we know so far about the next major update to Apple's Mac operating system. macOS 16 Name? Every year ...
Apple Intelligence General Feature

Report: Apple's Next-Gen Version of Siri Is 'On Par' With ChatGPT

Monday May 19, 2025 9:00 am PDT by
Apple has big plans to improve Siri over the next few years, Bloomberg's Mark Gurman and Drake Bennett report. Some Apple executives are now reportedly pushing to turn Siri into a true ChatGPT competitor. A next-generation, chatbot version of Siri has reportedly made significant progress during testing over the past six months; some executives allegedly now see it as "on par" with recent...

Top Rated Comments

LordVic Avatar
173 months ago
I for one, am impressed with the Corporate responsibility that Apple is showing under the leadership of Cook.

It's been a short few months, but he's already been more open, and forward facing than I believe Job's ever was when it came to Criticism and "scandal".

Things like the way he addressed health and safety of suppliers, To pushing with the Dividends and revenue sharing shows that Tim Cook is more understanding of todays economies and where the average worker fits into than Steve Jobs was.

Steve Jobs might have been an amazing sales person. Fantastic ideas and a brilliant strategist. But a Philanthropist or a "people person" i think was something he never was
Score: 10 Votes (Like | Disagree)
ArtOfWarfare Avatar
173 months ago
With Apple closing in on $100B, they could have a significant impact on the national debt...

A bigger thing they could do to help, however, would probably be displace all of Congress with their own management teams.

Or at least go and teach Congress how to properly make financial decisions.
Score: 7 Votes (Like | Disagree)
mbrannon47 Avatar
173 months ago
I am LOVING this type of MacRumors reporting. Original, fresh, and relevant. Spot on, guys. Keep up the great work. :)
Score: 7 Votes (Like | Disagree)
kolax Avatar
173 months ago
$100 billion is just insane. It's incredible how quickly they've accumulated so much cash.

As long as someone sane is sitting on the top of the pile... I'd hate to see things go sour. $100 billion won't last long with a few idiotic decisions.
Score: 7 Votes (Like | Disagree)
entropys Avatar
173 months ago
its not about being "nice".
it's about being socially responsible.

The worst thing for any economy is hoarded cash. The best thing is for money to be re-circled into the economic ecosystem.

Apple sitting on 100 billion in Cash reserves is absolutely a detriment to America, and the current economic conditions of the world.
Just imagine if Apple spent even 1/2 of that on hiring people and raises. Injecting 50 BILLION back into the economy.

it has nothing to do with being charity. More money in the consumers hands means more consumers and more consumers with money buying more stuff.
This viewpoint is just tragic. One of the main reasons the US is in such trouble at the moment is that too much of its wealth has been frittered away in some deluded keynesian broken window fallacy.

Spend the money in productive, business building practice, sure. The problem is finding the best way to use it. Apple earned that money, so they are no doubt disinclined to waste it. Only politicians are inclined to piss money up against a wall in a way that doesn't end up earning real money.

If looked at in a positive way, Apple has worked out how to build things that are so desirable they have created their own demand. It should find new ways to make shiny, desirable things that people want to buy. Which is course, exactly what it does, and is thus rewarded by the market.

Keynesians, on the other hand, fantasise that creating artificial demand by spraying money around somehow builds the economy. All it does is kick the problem down the road. meantime, the few US businesses that have worked out how to do things properly like Apple are castigated, rather than used as an example for others to follow. It's just like the story of the little red hen.

The other particular aspect of Apple's "problem", of course, is that most of that money is abroad, and Apple can't bring it back without paying US tax on money it has already paid tax on in the country it was earned. Kind of a massive own goal there, America.
Score: 4 Votes (Like | Disagree)
HarryKeogh Avatar
173 months ago
dumb question alert: Why does a company buy back shares of its own stock? What's the strategy or benefits to it?
Score: 4 Votes (Like | Disagree)