Apple approves additional $30 billion share buyback
New York: In a move to reward investors, tech giant Apple has approved an additional USD 30 billion share buyback by 2015 and declared a seven-for-one stock split on the back of strong iPhone sales that pushed its March quarter profit up 7 percent.
Apple increased its share repurchase authorisation to USD 90 billion from the USD 60 billion level announced last year, it said in a statement. The firm also approved an 8 percent increase in quarterly dividend to USD 3.29 per share.
"We are confident in Apple's future and see tremendous value in Apple's stock, so we're continuing to allocate the majority of our programme to share repurchases. We are also happy to be increasing our dividend for the second time in less than two years," Apple Chief Executive Officer Tim Cook said.
Apple has spent USD 66 billion in cash on its capital return programme between August 2012 and March 2014.
The Cupertino, California-based firm will return more than USD 130 billion to shareholders by the end of 2015, up from its previous target of USD 100 billion.
For the second quarter ended March 29, 2014, Apple posted a 7.4 percent growth in net profit of USD 10.2 billion and 4.6 percent in revenue at USD 45.6 billion. Apple exceeded its revenue forecast of USD 42 billion to USD 44 billion in second quarter of 2014.
"We are very proud of our quarterly results, especially our strong iPhone sales and record revenue from services. We are eagerly looking forward to introducing more new products and services that only Apple could bring to market," Cook said.
The company expects revenue of between USD 36 billion and USD 38 billion in the third quarter
"We generated USD 13.5 billion in cash flow from operations and returned almost USD 21 billion in cash to shareholders through dividends and share repurchases during the March quarter," Apple Chief Financial Officer Peter Oppenheimer said. That brings cumulative payments under the capital return programme to USD 66 billion, he added.
The Americas accounted for over 31 percent of Apple's revenue, while Europe contributed 22.4 percent, Greater China 20 percent, Japan 8.6 percent and the rest of Asia Pacific 5.7 percent.
Apple sold 43.71 million iPhones, accounting for USD 26.06 billion of revenue, beating expectations of a slowdown in sales of the smartphone.
Apple sold 16.35 million units of iPad, 4.13 million units of Mac and 2.76 million units of iPod.
Globally, the iPhone faces tough competition from smartphones running on Google's Android operating system.
In January, Apple started selling iPhones through China Mobile, the world's largest telecom player, which has more than 770 million subscribers.