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Apple’s Buyback Bonanza: A Half-Trillion-Dollar Affair

In the world of big business, Apple is making some bold moves. Over the past decade, the tech behemoth has splashed out an eye-watering $500 billion on stock buybacks, according to a Markets Insider breakdown.

Now, let’s put this staggering figure into perspective. Apple’s buyback total eclipses the entire market capitalization of heavyweights such as Visa ($489 billion), JPMorgan ($446 billion), and even Exxon Mobil ($441 billion). To get an even clearer picture: only a select group of eight companies in the S&P 500 boast a market value surpassing what Apple has spent on buybacks.

Going deeper into the numbers, since 2018, Apple has been consistent, dishing out over $50 billion annually to repurchase its own shares. In the last fiscal year alone, it laid out $90 billion for buybacks and scooped up another $56 billion of its stock in the lead-up to July 1.

But they aren’t stopping there. Apple’s board gave the green light for another colossal $90 billion of repurchases. That’s more than the entirety of Citigroup’s worth ($85 billion) and nearly double the market cap of the sweet giant, Hershey’s ($46 billion).

Now, if you’re wondering about the impact of these buybacks, Charlie Bilello, the chief market strategist at Creative Planning, highlighted in a recent tweet an interesting fallout: Apple’s massive repurchase initiative has effectively trimmed its outstanding shares by over a third – plummeting from around 25 billion to just under 16 billion.

Warren Buffett, the Oracle of Omaha and a vocal advocate of sensible buybacks, has consistently backed Apple’s buyback strategy. Let’s not forget, his conglomerate, Berkshire Hathaway, holds a significant chunk of Apple – nearly 6%. This position forms a massive part of its estimated $350 billion stock portfolio. The beauty of Apple’s repurchases? It bolsters Berkshire’s stake without costing the conglomerate a dime.

Buffett, in his 2021 letter to shareholders, showered praise on Apple’s approach, especially commending CEO Tim Cook’s strategic prowess. He wrote, “Much of what the company retained was used to repurchase Apple shares, an act we applaud.” He further lauded Cook’s unique blend of prioritizing Apple product users while ensuring all stakeholders reap the benefits of his management.

For investors and entrepreneurs alike, Apple’s ambitious buyback strategy paints an insightful picture of corporate finance dynamics and how it can shape shareholder value. As always, the tech giant continues to surprise, inspire, and redefine the art of business.