Apple Inc has approved another US$30 billion in share buybacks till the end of next year and authorized a rarely seen seven-for-one stock split, addressing calls to share more of its cash hoard while broadening the stock’s appeal to individual investors.
The company also approved an approximately 8 percent increase in its quarterly dividend to US$3.29 for each share.
Activist investor Carl Icahn, who had famously called on the iPhone maker to boost its buyback program, tweeted his approval of the move on Wednesday.
Shares of the company, which have remain mired near the US$500 to US$550 range since the start of the year, jumped almost 8 percent to US$566.5 in after-hours trade, the highest since December last year and adding roughly US$35 billion to its market worth.
On Wednesday, Apple reported sales of 43.7 million iPhones in the quarter ended last month, far outpacing the roughly 38 million that Wall Street had predicted. That drove a 4.6 percent rise in revenue to US$45.6 billion — a record for any non-holiday quarter — and beating Wall Street’s projections for about US$43.5 billion.
Apple’s earnings rose 7 percent to US$10.2 billion in the quarter, or US$11.62 per share, an amount that exceeds what most technology companies make in an entire year.
Whether Apple can again produce a revolutionary new product remains the central question in investors’ and Silicon Valley executives’ minds. The smartphone market is maturing, and rivals like Samsung Electronics Co Ltd and Google Inc are taking chunks out of Apple’s mobile-device market share.
Many hope that the next iPhone, which sources have said will sport a larger screen with new display technology, will provide a timely lift to the company’s bottom line come September, when Apple usually introduces the latest version of its core product.
Speculation persists that the company will take the lead in wearable devices with a smartwatch or other gadget, given that chief executive officer Tim Cook has spoken about “new product categories” to be released this year.
For now, the company’s momentum in China and emerging markets has been the topic of much discussion in investor circles. On Wednesday, chief financial officer Luca Maestri told reporters that the jump in iPhone sales was “very broad-based,” but singled out Greater China and Japan, where business got a boost from the recent inclusion of NTT Docomo Inc and China Mobile Ltd (中國移動) as carrier partners.
Overall revenue from Greater China, which includes Taiwan and Hong Kong, climbed 13 percent to US$9.29 billion in the quarter. Japanese sales rose 26 percent to US$3.96 billion.
However, iPad sales fell 16 percent from last year to about 16.4 million tablets.
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