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  • Writer's pictureRealFacts Editorial Team

Apple Stock Surges as Company Announces Largest Buyback Plan in History

Updated: May 7


Apple store

Apple narrowly surpassed Wall Street's expectations for its fiscal second quarter, reporting earnings of $1.53 per share on sales of $90.8 billion, slightly beating analysts' forecasts of $1.51 per share on sales of $90.4 billion. Despite a slight increase in earnings compared to the previous year, sales experienced a 4% decline. Additionally, Apple raised its quarterly dividend by 4% to 25 cents per share and authorized a $110 billion share repurchase plan. Ken Shreve, Investors Business Daily author reported that this buyback plan is “the largest ever for a publicly traded company.” As a result, Apple's stock rose in after-hours trading and gained over 7% mid-day Friday.

 

The recent gains in the stock can be attributed partially to the fact that negative sentiment was already factored into its price. Despite the significant increase on Friday, the stock remains down approximately one percent year to date. A significant portion of this negative sentiment stems from the recent underwhelming performance observed in the Chinese iPhone market. During Bloomberg Markets: The Close, Jess Menton from Bloomberg News discussed Apple's recent struggles in China. He said, “It feels like Apple has gotten ensnared in the US-China conflict…things aren't that bad in the entirety of their China business because this is really an iPhone-specific issue. It doesn't necessarily impact wearables, Mac, iPad, and services as much as it impacts the iPhone.” Additionally, Luca Maestri, Apple CFO stated, “Obviously China is the most competitive smartphone market in the world without a doubt, but we feel good about the results.” Amidst the challenges posed by China's competitive market, numerous investors find satisfaction in the achieved results, leading to renewed investing in the tech giant.


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