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Investor Calls For Cook To Spend Some Money As Apple's Cash Hoard Swells To Record $256.8 Billion

Investor Calls For Cook To Spend Some Money As Apple's Cash Hoard Swells To Record $256.8 Billion
Rising up more than $10 billion from the previous quarter, Apple’s enormous cash pile swelled to $256.8 billion in the fiscal second quarter.
Therefore, now market value of general Electronic is less than Apple's war chest which is also just smaller than the market value of Wells Fargo.
But despite this, as iPhone shipments were disappointing, the tech giant also reported revenue that missed Street expectations on Tuesday. And as more than 3.9 million shares changed hands, the stock fell as much as 2 percent in after-hours trading.
A slew of speculation of acquisitions that Apple might make have been long fueled by the company's cash reserves.
It would be easier for Apple to spend some of the money on acquisitions without taking a major tax hit as President Donald Trump and the Republican-controlled Congress are expected to change rules on repatriation of cash stored overseas even as it is known that Apple keeps most of its cash outside the U.S. for tax reasons.
At the same time, an irate investor has said that “'it's time for Tim Cook to spend the money.”
One investor of the company is demanding that Apple should start spending the money that it has stocked overseas and estimates are that it is worth more than $250 billion in cash.
Gerber Kawasaki Wealth and Investment management CEO Ross Gerber said he's tired of Apple sticking by its playbook while talking at a TV show.
"Their services business has a lot of risk to it from other companies like Netflix and Spotify and Samsung and all the other players," Gerber said. "And they have all this cash, and all they can come up with is the same playbook, which is buy back stock and pay dividends," Gerber said. "Buy something, please. Go out and do something aggressive."
Paying out a total of $13.22 billion to investors, Apple increased its quarterly dividend on Tuesday from $0.57 to $0.63, true to the playbook Gerber references.
Gerber did not make any new suggestions for Apple during Tuesday's comments even though he has previously suggested Apple buy GoPro.
"It's time to put the heat on Tim Cook," Gerber added. "It should be illegal to have $250 billion dollars in cash and not utilize it – that is what you're supposed to do as CEO," Gerber said.
"It's a value stock, and that's all it is."
At the same time, a slight drop in its quarterly iPhone unit sales was reported by the IT giant. from 51.2 million units a year earlier, the sale dropped to 50.8 million units. In the fiscal second quarter that ended April 1, analysts, on average, had expected it to sell 52.2 million.
However, Apple made more money because of demand for its pricier iPhone 7 Plus even though Apple sold fewer iPhones. Up from $642 a year ago, the iPhone's average selling price was $655 in the quarter.
Compared to its smaller sibling, the iPhone 7, the iPhone 7 Plus included a newer, better camera. Apple CEO Tim Cook admitted that Apple didn't correctly predict just how many people would opt for the bigger phone over the iPhone 7 and called iPhone 7 Plus demand "robust".
"It took us a little while to adjust all the way back through the supply chain and to bring iPhone 7 Plus [availability] into balance, which occurred ... early this past quarter," Cook said.
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Christopher J. Mitchell

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