Apple to issue a dividend of $2.65 per share, also plans to buy back $10 b worth of stocks

Last night Apple announced that they would reveal what they were planning to do with the close to $100 billion they have in the bank. Now that it’s the crack of dawn, we have a press release:

“Subject to declaration by the Board of Directors, the Company plans to initiate a quarterly dividend of $2.65 per share sometime in the fourth quarter of its fiscal 2012, which begins on July 1, 2012.

Additionally, the Company’s Board of Directors has authorized a $10 billion share repurchase program commencing in the Company’s fiscal 2013, which begins on September 30, 2012.

Does this mean anything for you? Not really. After all is said and done Apple says that they’re still going to have roughly half of what they have in their “war chest” today, which is money that they’ll spend to do things like secure components, open Apple stores, and possibly make acquisitions.

Investors are probably jumping for joy since they’re going to get a nice(r) return on investment, but chances are that if you’re reading this article you aren’t an investor, you’re just a gadget geek looking for the latest updates about the mobile industry.

Why is Apple doing this? That’s a great question. Steve Jobs lived through Apple’s near bankruptcy, which explains why he was so paranoid about keeping a huge amount of dough under the mattress in case god knows what happens. Tim Cook on the other hand has repeatedly said that he’s not like Steve, and that he’s less religious about Apple’s loot. It’s not like Apple needed to compel investors to buy Apple stock … just look at how well the company is currently operating.

Expect to see more analysts than you can shake a stick at offering their opinions about this news item. Also, we may update this piece with more information since there’s a conference call set to kickoff in about 12 minutes.

Update: The call is over and the folks at Apple Insider have a fantastic list of quotes.

  • Hello intomobile! $9.9B is chump change to Apple. They have $98B in cash or cash equivalents! It’s just barely over 10% of their cash reserves. They will still have $89B in cash! Many people will get a piece of that money though, indirectly, through mutual funds that may hold those shares in a fund. If you are in a technology sector mutual fund, you will most certainly be getting a dividend.

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