Submitted by Jon Reed on
Along with releasing its Q2 fiscal results today, Apple announced that its Board of Directors has authorized an increase to its program to return capital to its investors. On top of that, the company also announced that its shares will be undergoing a seven-for-one stock split in June.
The expanded program allows Apple to spend up to $90 billion on share repurchases, up from the $60 billion that was announced last year. The company expects to use a total of $130 billion under the expanded program by the end of 2015. The increased buyback will generate capital for stockholders and is something
hedge fund billionaire Carl Icahn has pushed for in recent months. CEO Tim Cook said of the expanded program, "We’re confident in Apple’s future and see tremendous value in Apple’s stock, so we’re continuing to allocate the majority of our program to share repurchases. We’re also happy to be increasing our dividend for the second time in less than two years." The latter refers to the Board's decision to increase Apple's quarterly dividend by 8 percent, which will result in a dividend of $3.29 per common share, payable on May 15, 2014. Apple's annual dividend payments of $11 billion place the company as one of the largest dividend payers in the world.
In addition to the increased share repurchase funding and dividends, Apple announced that its shares will undergo a seven-for-one split in June. Every shareholder of record at the close of business on June 2 will receive six additional shares for each share owned. Trading will begin on a split-adjusted basis on June 9.
The news has excited investors, the after hours trading shows AAPL up $41.20 (7.85%) as of this writing.